As we have previously reported, Delaware is in the midst of reforming its unclaimed property audit rules, a move that will inevitably affect the myriad businesses headquartered or incorporated there. Recently, Delaware Governor Jack Markell signed into law Senate Bill 11, "An Act to Amend Title 12 of the Delaware Code Relating to Escheats." The law aims to increase competition among outside, independent auditing firms and to slow the revolving door between government and the private sector. However, it does not address the entirety of concerns that have been expressed by companies holding unclaimed property. Auditors currently use potentially unconstitutional methods to estimate the amounts owed by holders when records are unavailable. The new law does not address this practice, nor does it limit the time frame for which a company can be audited, which currently extends back to 1981. Thus, until the state can pass future amendments, and pending the promulgation of a detailed procedure manual by the Delaware Secretary of Finance, comprehensive reform in this area remains yet unclaimed.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
