Practice Test GeeksTICO - Travel Industry Council of Ontario Practice Test
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Trust Accounting Requirements Flashcards

7 cards from real TICO practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Trust Accounting Requirements flashcards as text

  1. A travel agency is winding down operations. Under TICO requirements, what must happen to the funds remaining in the trust account?

    Answer: They must be refunded to clients or remitted to suppliers as applicable

    Upon closure, all trust funds must be properly disposed of by refunding clients or paying suppliers — they cannot be kept by the agency.

  2. What does 'trust account reconciliation' require a travel registrant to compare?

    Answer: Trust account bank balance against client liability records

    Reconciliation means confirming that the trust account bank balance equals the total of all outstanding client liabilities held by the agency.

  3. A client cancels a trip and is entitled to a full refund. Under TICO trust accounting rules, the refund should be paid from:

    Answer: The trust account, since the funds were held there

    Since client funds are held in trust, refunds must be issued from the trust account to maintain proper accounting.

  4. Which of the following best describes the purpose of TICO's trust account requirements?

    Answer: To protect consumer funds in the event an agency defaults or closes

    Trust account requirements exist primarily to safeguard consumer funds so travelers are protected if an agency fails before the trip occurs.

  5. A travel agency receives a supplier commission rebate into its trust account by mistake. What should the registrant do?

    Answer: Transfer the commission to the operating account promptly after identification

    Non-client funds such as commissions must not remain in the trust account; they should be transferred to the operating account as soon as identified.

  6. Under TICO regulations, how often must a registered travel agency perform a trust account reconciliation at minimum?

    Answer: Monthly

    TICO regulations require that trust account reconciliations be performed at least monthly to ensure ongoing accuracy.

  7. A prospective client asks why their deposit cannot be held in the agency's regular bank account. The best explanation is:

    Answer: Mixing client funds with agency funds makes it impossible to protect consumers if the agency becomes insolvent

    Commingling client and agency funds creates a risk that consumer money could be lost if the agency faces financial difficulty, which is why segregation is mandated.