23rd March, 2023
On 1 March 2021, Queensland implemented a new trust account framework under the Building Industry Fairness (Security of Payment) Act 2017.
The phased rollout of the Project and Retention Trust Account requirements will impact many building and construction projects in Queensland above $1 million.
This new framework is designed to strengthen the security of payments of subcontractors in the Queensland construction sector.
As a leader in the construction business management software space, MYOB hosted a webinar session covering the introduction of this new trust framework.
In the webinar we heard Bruce Minty, Senior Product Manager, MYOB talk with Laura Hattin, Principal Consultant, Building Trusts.
Laura is an expert on the trust account requirements for builders in Queensland.
She brings more than six years of experience working to implement new legislation with the Queensland Building and Construction Commission (QBCC) and is one of the leading speakers on both the policy objectives and the QBCC expectations for compliance with the new requirements.
In this webinar, Bruce and Laura discuss in detail the best practice in managing trust accounts in construction and addressed a range of industry-related concerns.
As Laura explained, the projects that are currently impacted by the new legislation include:
She noted that there are a few exemptions:
“The main ones being for small scale residential work such as a house; a project for 2 living units or less does not require a trust account.
“There is also an exemption for Federal Government projects and projects where the majority of the work is for civil or mining work such as roads, bridges and tunnels.”
There was robust questioning around compliance to this Act, with Bruce asking Laura how builders and contractors can ensure they’re remaining on top of their obligations.
As Laura outlined, the keys to remaining compliant include:
While there seems to be “a lot of additional back-office work for companies across both their administrative and finance functions”, noted Bruce, not remaining compliant will have a greater impact on your business.
The discussion covered a lot of useful topics, including the tools available to manage your business compliance.
“It’s not possible to be compliant with the trust account requirements without using some form of accounting software”, Laura explained.
“This is because there are strict record keeping requirements that must be met for each trust account and records must be immutable and separate from a company’s business records.”
In addition, she noted each trust account must be reconciled monthly and certain notifications sent when payments are made.
“Accounting software has the potential to significantly improve a trustee’s ability to track and manage project payments, the company’s cashflow and overall financial position.”
For construction businesses that need to meet the trust account requirements, MYOB has fast-tracked development of additional MYOB Advanced Construction functionality to create smart tools to support day-to-day transactions and reporting to help you remain compliant.
Watch the full recording of the webinar here.