A1 / Dormant Trust Account Audit


Dormant Trust Account

A dormant trust account is a trust account that has been completely inactive for the entire audit period, meaning it has had no transactions and has held no trust money at any time during that period. To be considered dormant, the account must remain entirely free of funds and unused for any trust-related activity throughout the audit period. Despite its inactivity, it must still comply with applicable regulatory and reporting obligations until it is formally closed.


Why Keep a Dormant Trust Account?

Even if a trust account isn't currently in use, there are valid reasons for keeping it open. Some firms retain dormant accounts to avoid the hassle of closing and reopening, to meet licensing or compliance requirements, or in anticipation of future trust activity. Others may be in the process of winding down or restructuring their practice.

Whatever the reason, dormant trust accounts must still meet all regulatory obligations.