The EAAB has agreed to discontinue the policy of cancelling FFC’s on the non/late submission of audit reports within exactly four months of an estate agency’s financial year end.
The policy was onerous and detrimental to many. Countless late submissions are the result of auditors not acting timeously and the computer system at the EAAB not functioning at crucial times amongst other reasons. The biggest hardship was not the fine that would be imposed (which is not insignificant!) but more the effort and time lapse in, once again, obtaining a FFC. The resultant material problem is that during this time lapse the entire agency couldn’t legitimately earn commission in the absence of a valid FFC.
Rebosa raised this matter on numerous occasions and eventually submitted a legal opinion from Cliffe Dekker Hofmeyr attorneys, supporting our submission that the above policy is not in compliance with the law.
The EAAB will in future follow normal procedures and agencies will at worst after due process, have to pay a fine if the relevant committee deems a fine necessary. The FFC will however, through this process, remain in full force and effect. The committee may of course find reason to cancel an FFC after due process.
The same legal opinion supported our contention that the EAAB erred in refusing to issue FFC’s to agencies iro late/non submission of audit reports relating to the financial year which has expired before the date on which the application for a FFC was made. In other words, that the late/ non submission of an audit report for June 2015 should have no impact on the application for a FFC for 2017 when the audit report for 2016 was submitted correctly and timeously.
The EAAB has now agreed to comply with said legal opinion except in cases where irregularities have been reported or are suspected.
This is excellent news for the industry and moreover for estate agents who were previously affected by their Firms’ alleged late audit report submission.
We have thanked the EAAB appropriately.
Jan le Roux