Unclaimed Property Reporting

Is your company holding on to someone else’s money? Businesses must follow the Unclaimed Property reporting requirements to report and remit unclaimed property (ex: uncashed checks) to the state each year. The State of Arizona’s Unclaimed Property division has some great resources to help your company stay in compliance. Visit www.azunclaimed.gov for more information.

Building a comprehensive Unclaimed Property Program

It’s important that your company has an effective method of reporting unclaimed property in order to comply with the law.  There are other benefits, however, to creating companywide awareness of the unclaimed property requirements.  Creating policies and uniform procedures helps you to deliver excellent service by reuniting your customers with their property more effectively.   In addition these procedures will enhance your own internal controls which are important to protect both unclaimed property and your company.  It’s important to remember that unclaimed property has a higher risk of embezzlement or fraud because the owners are not present. 

 To create a comprehensive unclaimed property procedure we suggest:

1. Identify and include all necessary departments
2. Include key players such as accounting and payroll personnel
3. Research your companies reporting requirements in the Reporting Requirements section of our website and the Arizona Revised Statutes
4. Define responsibilities and roles
5. Determine what tools your company will need to collect information, produce due diligence letters and your final reports
6. Identify the employees who will be accountable for unclaimed property compliance
1. Due diligence letters must be sent to owners at least 120 days before the property is reported to the State of Arizona Department of Revenue
2. Decide when reportable property should be transferred to an unclaimed property account
3. Unclaimed Property must be reported by November 1st of each year and Insurance reports are due May 1st of each year
7. Develop a timeline:       

 

To put your program in place we suggest that you:

1. Initiate a companywide training program to educate and  introduce your employees to their roles and responsibilities
2. Review your companies reporting history to determine if a special audit is needed in order to become compliant with the current reporting requirements
3. Maintain your reporting records for at least five years from the filing date

 

Having a good system in place is an important factor if you are ever audited by the State’s Unclaimed Property division.