Another Round of Delaware Invitation Letters Go Out

It has come to PEACC’s attention that another round of Delaware (“DE”) Unclaimed Property Voluntary Disclosure Agreement (“VDA”) Invitation letters have been mailed out by Secretary of State Office to various Holders throughout the Country incorporated in DE, in most cases.

The scheduled mailing date of these invitaion letters is mid-August. If your company happens to receive one of these letters from Delaware, it is in the Holder’s best interest to respond to the State within 90 days of the letter date. If the Holder does not respond within the 90 days the letter recipient will be selected for an Unclaimed property audit be the Delaware Department of Finance. Therefore, PEACC advises all Holders who receive the VDA Invitation letter to come forward, voluntarily and
participate in the Delaware VDA. Participants in the DE VDA are provided numerous benefits from the State that outweigh going through an unclaimed property audit and may save the Holder money.

To hear more about the Pro’s and Con’s of participating in a State VDA or fir help in navigating the process, whether formal or not, please reach out to a professional at PEACC.com by calling 410.303.5510 or email us at info@peacc.com

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

Unclaimed Property Audits & Reviews

Who has the ability to audit Holders? Most State jurisdictions have the ability/authority to preform the dreaded Unclaimed Property Audit. Most States have their own audit staff conducting their own various State Audits. But most States still contract with third-party auditors. These third-party auditors have, in the past, conducted contingency fee Unclaimed Property Audits. Where these firms get a percentage of what they uncover from the Holder. Now, most States pay an hourly rate to perform Audits on behalf of a State. The third-party auditors under contract with most States, include the following firms:

• Kelmar Associates, LLC
• Specialty Audit Services (SAS)
• Kroll (was Versus Financial)
︎• Treasury Services Group, LLC (TSG)
• Innovative Advocates Group, LLC
• Discovery Audit Services (DAS)
• Escheatment Expertise Consulting Services (EECS)
• Faegre, Drinker, Biddle & Reath (FDBR)
• KDAC, LLC • Barnes & Thornburg
For further help in navigating the complexities of third-party unclaimed property auditors, please contact PEACC at 410.303.5510 or email us at info@peacc.com

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

What Areas of a Company are Analyzed to Perform a Thorough Unclaimed Property Review or Audit?

–  Corporate structure
–  Current and previous Chart of Accounts
–  Review of Accounts that May Hold Uncashed Property
–  Review of General Leger Trial Balances
–  Any previous State unclaimed property reports.
–  Any past audit reports & results
–  Outstanding check listing of all disbursement accounts
–  Accounts Receivables aging report
–  Journal entries related to write-offs and any details
– Descriptions and any contracts related to any third-party administrators
–  Any mergers & acquisitions reports and detail

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

TYPES OF UNCLAIMED PROPERTY AUDITS & REVIEWS

State Unclaimed Property Audit

    – done by individual State or can be done jointly with other State(s).

Reciprocal Audit

    – One State audits on behalf of other State(s)
    – Expenses and resources are shared

Private Audit Firms

     – State Contracts Out Third-Party Audit Firm
     – May Get Paid Based Upon a Percentage of What They Find

Telephone Audits & Reviews

     – State contacts Holder via phone.
     – Listen for uncertainties & inconsistencies in voice.

“Highway Audits”

     – State audit employees look for newspaper headlines, billboards and trucks while out of office for audit candidates.

For further information about the types of unclaimed property audits and how to navigate thru them,
please contact the experts at PEACC at 410.303.5510 or email us at info@peacc.com

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

Four Phases of the Unclaimed Property Audit Process

The Four Phases of the Unclaimed Property Audit Process include:

PHASE I
  ~ Entity & property types scoping
    –  Public information review/10k
    –  Tax Return review
    –  Analysis of general ledgers & Review of all legal entities

PHASE II
~  Quantification of Any Potential Unclaimed Property
    – Bank Accounts detail (aged trial balances review)
    – Transaction level detail (aged outstanding check listings, Accounts Receivables credit write-offs, etc.)

PHASE III
~ Research Analysis, Remediation & Due Diligence Adjustments
   – Individual Property type &  Entity exposure provided to Holder.
   – Research, Remediation and due diligence results included in final findings.

PHASE IV
~ Unclaimed Property agreed upon final report and remittance sent in to State.

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

Delaware Unclaimed Property (VDA)

Now that your fall unclaimed property reporting is complete, your PEACC Team of Advisors would like to announce Delaware is schedule to send out the next round of VDA invitations on November 15, 2024. The State last sent invitation letters out in February 2024.

If your organization receives a VDA (Voluntary Disclosure Agreement) invitation Letter from Delaware and fails to timely respond, you will become eligible for the dreaded, unclaimed property audit. Contact the professionals at PEACC to discuss your options, along with the process, at 410.303.5510.

https://lnkd.in/eTMSCMqp
VDA Invitation Dates – VDA Program – State of Delaware
vda.delaware.gov

State of Delaware map

What to Expect during your self-audit

Been given the option to perform a self-audit or review vs a state or state sponsored 3rd-party unclaimed property audit?

Here’s what to expect during your self-audit/review.

– The States allow less time to complete a self-audit/review vs a full fledged State sponsored audit to be completed.
– The States expect a thorough review of the company’s books & records for the entire lookback period. Normally 10 years plus the dormancy period.
– The State will utilize a State sponsored 3rd-party auditing firm to assist is gathering information and reviewing it.
– State report submission is normally done through a State webpage portal in a specific, State approved, format.
– If, after adequate testing and reviews are completed, Self-Audits can be completed fairly quick and without too many headaches.

For help with self-audits or any questions regarding this process, please reach out to one of the Professionals at PEACC by calling 410.303.5510 or email us at info@peacc.com

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