Final answer:
A broker must follow certain requirements when it comes to an interest-bearing trust account, including maintaining separate accounts, keeping accurate records, and disbursing funds appropriately.
Step-by-step explanation:
A broker must follow certain requirements regarding an interest-bearing trust account.
- Maintaining Separate Accounts: A broker must keep the funds in an interest-bearing trust account separate from their own business funds. This is to ensure that the client's funds are protected and not commingled with the broker's own money.
- Keeping Accurate Records: The broker must maintain detailed and accurate records of the transactions and balances in the interest-bearing trust account. This includes recording all deposits, withdrawals, and any interest earned.
- Disbursing Funds Appropriately: The broker is responsible for disbursing the funds from the interest-bearing trust account according to the instructions of the client. This may include making payments, investing the funds, or returning the funds to the client.
Overall, a broker must exercise great care and responsibility in managing an interest-bearing trust account to ensure the proper handling of client funds.