Code of Massachusetts Regulations › 960 CMR - OFFICE OF THE STATE TREASURER AND RECEIVER GENERAL › Title 960 CMR 4.00 - Procedures For The Administration Of Abandoned Property › Section 4.07 - Audit Program

Current through Register 1525, July 5, 2024
Pursuant to M.G.L. c. 200A, § 12, the Treasurer, his/her
				designee or agent may at any reasonable time and upon reasonable notice examine
				or audit a holder's books, papers or other records to verify proper compliance
				with the reporting requirements of M.G.L. c. 200A.
(1)
Period of
			 Limitation
. Pursuant to M.G.L. c. 200A, § 12, the Treasurer
			 may examine the records of a holder at any time within six years of the date
			 upon which an annual abandoned property report was due to be filed with the
			 Division, or the date upon which such report was received by the Division
			 pursuant to an extension granted under the provisions of M.G.L. c. 200A, §
			 13B, whichever is later. In the case of a holder who has filed abandoned
			 property reports with the Division as required by law, the scope of the
			 examination of the holder's records will be limited to property that had become
			 reportable during the six-year period of limitation defined in M.G.L. c. 200A,
			 § 12(f). In the case of a holder who fails to file abandoned property
			 reports with the Division as required by law, or who files a false, fraudulent
			 or insufficient report, the six-year period of limitation shall be waived for
			 purposes of record retention and the conducting of examinations.
(2)
Records
			 Retention
. In accordance with M.G.L. c. 200A, § 12(f),
			 holders are required to maintain abandoned property records for nine years from
			 the date of last activity for any property which has been reported to the
			 Division, or six years from the date such property is reported to the
			 Division.
(3)
Failure
			 to Maintain Records
. In the case of a holder that has met the
			 annual reporting requirement of M.G.L. c. 200A, § 7(d), but where the
			 holder does not meet the records retention requirements of M.G.L. c. 200A,
			 § 12(f), the Treasurer, his designee or his agent may employ such
			 estimation techniques in the conduct of an audit as are customary and
			 reasonable in the area of regulatory compliance and enforcement to fairly and
			 accurately estimate the liability for property category types that may not have
			 been reported or fully reported by the holder.
(4)
Audit Process.
(a) Excluding any state-authorized
			 multi-state abandoned property audit/examination, the Treasurer ma y co nduct
			 either a "desk audit" or a "field aud it" of holder records pursuant to M.G.L.
			 c. 200A, § 12 and the provisions of 960 CMR 4.07.
(b) A "desk audit" shall consist of the
			 Treasurer, his/her designee or agent examining the books, papers or other
			 records of a holder at the office of the Division to determine compliance with
			 the abandoned property reporting requirements of M.G.L. c. 200A, § 7. The
			 person authorized to conduct this audit may request any information necessary
			 to complete the audit and may require the holder or his/her representative to
			 appear in person. Performance of a desk audit does not preclude the Division
			 from the subsequent performance of any future desk or field audit, provided
			 however, that following the conclusion of a field audit as defined in 960 CMR
			 4.07(4)(c) and upon payment by the holder of any assessments issued in such
			 audit, or upon payment of any assessments upheld in an appeal of such audit
			 assessments, the period audited shall be closed to any future Massachusetts
			 abandoned property audit in perpetuity.
(c) A "field audit" shall consist of the
			 Treasurer, his/her designee or agent conducting an examination of the books,
			 papers or other records of a holder at the holder's place of business. The
			 holder shall be notified in advance that he or she has been selected for audit
			 and shall be instructed as to the books, papers and other records which should
			 be made available to complete the audit.