DEPARTMENT OF TREASURY  
STATE TREASURER  
AUDIT STANDARDS FOR EXAMINATIONS UNDER  
THE UNIFORM UNCLAIMED PROPERTY ACT  
(By authority conferred on the state treasurer by sections 31 and 40 of the Uniform Unclaimed  
Property Act, 1995 PA 29, MCL 567.251 and 567.260.)  
R 567.1 Definitions.  
Rule 1. As used in these rules:  
(a) “Act” means the uniform unclaimed property act, 1995 PA 29, MCL 567.221 to  
567.265.  
(b) “Administrator” means the state treasurer.  
(c) “Auditor” means an individual, a business association, public corporation, or any other  
legal or commercial entity designated and authorized by the administrator or his or her designee  
to conduct an examination of a person to determine compliance with the act. Auditor also  
includes those employees, agents, subcontractors, and representatives of the designated and  
authorized individual, business association, public corporation, or any other legal or commercial  
entity.  
(d) “Confidential information” means all nonpublic proprietary information, information  
protected by MCL 205.28(1)(f), and any information protected by state or federal law from  
disclosure including the social security number privacy act, 2004 PA 454, MCL 445.81 to  
445.87, and the identity theft protection act, 2004 PA 452, MCL 445.61 to 445.79d. Confidential  
information does not include information subject to release by law.  
(e)"Hardcopy" means any documents, records, reports, or other data printed on paper.  
(f) "Machine-sensible record" means a collection of related information in an electronic  
format. Machine-sensible records do not include hard copy records that are created or recorded  
on paper or stored in or by an imaging system such as microfilm, microfiche, or storage-only  
imaging systems.  
(g) “Officer,” for purposes of qualifying as an eligible holder under MCL 567.222, means a  
person who is appointed to serve as the president, vice-president, secretary, or treasurer of a  
corporation or a person who serves as a senior executive within a corporation or other  
organization. A senior executive is an individual who directs, controls, and coordinates activities  
that are generally assigned to a chief executive officer, chief operating officer, or chief financial  
officer.  
(h) “Person” means an individual, business association, state or other government,  
governmental subdivision or agency, public corporation, public authority, estate, trust, 2 or more  
persons having a joint or common interest, or any other legal or commercial entity.  
(i) "Storage-only imaging system" means a system of computer hardware and  
software that provides for the storage, retention, and retrieval of documents originally created  
on paper. It does not include any system, or part of a system, that manipulates or processes any  
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information or data contained on the document in any manner other than to reproduce the  
document in hard copy or as an optical image.  
(j) All terms not defined in these rules have the same meaning as when used in the act.  
History: 2017 AACS.  
R 567.2 Prohibition against use of collection goals or quotas.  
Rule 2. The administrator shall not use collection goals or quotas during the conduct of an  
examination of records under the act. If a person has information that an auditor is using a  
collection goal or quota while conducting an examination, the person shall inform the  
administrator. If the administrator finds that a goal or quota was used, such use constitutes a  
violation of law and a breach of contract that shall result in the replacement of the auditor for the  
examination and termination of a third party auditor contract. If the examination has been  
completed, the administrator shall review the fieldwork and examination findings to determine if  
the use of a goal or quota materially affected the results of the examination.  
History: 2017 AACS.  
R 567.3 Authority of administrator; selection factors for examination.  
Rule 3. (1) The administrator or his or her designee shall have sole authority to select a  
person for examination or to participate in an examination of that person commenced by another  
state. Factors that may be considered in determining whether to commence an examination or  
participate in an examination initiated by another state include, but are not limited to, the  
following:  
(a) Value of the person’s assets.  
(b) Annual sales volume of the person.  
(c) The reporting history of the person.  
(d) Mergers, takeovers, stock splits, sales, exchanges, liquidations, acquisitions, or other  
changes in equity.  
(e) Evidence or complaints of failure by the person to send written notice under section  
18(5) of the act to the apparent owner of property presumed abandoned or other complaints filed  
by property owners or other interested parties.  
(f) The person has not been previously subject to an examination by the state.  
(g) Examinations or other information indicate a trend or practice of failing to report the  
presumed abandonment of certain types of property within the person’s industry or business  
sector.  
(h) The extent of the person’s operations in this state including employees, vendors,  
stockholders, customers, and account holders.  
(i) Whether an examination has been initiated by another state or more than 1 state.  
(2) If the person selected for examination has information that the selection was not based  
on the criteria in subrule (1) of this rule or other factors that would reasonably subject a person to  
examination, the person shall provide the information to the administrator. The administrator  
will review the information and if the information supports the person’s claim that the selection  
was based on factors that would not reasonably subject a person to examination, the  
administrator will discontinue the examination. However, the person may still be subject to an  
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examination for the same property types and periods if at a later time, the person is selected  
based on the criteria in subrule (1) of this rule or other factors that would reasonably subject a  
person to examination.  
History: 2017 AACS.  
R 567.4 Auditor’s compliance with administrator’s interpretation of law, policy, and  
procedures.  
Rule 4. When an auditor conducts an examination under a contract with the administrator,  
the auditor shall conduct the examination in compliance with the administrator’s interpretation of  
the act, policy, and procedures. Except for nondisclosure agreement disputes under R 567.11(4),  
the person subject to examination may request an interpretation of the act, policy, or procedure  
from the administrator for resolution. The administrator will respond to the auditor and the  
person subject to examination.  
History: 2017 AACS.  
R 567.5 Notice of commencement of examination.  
Rule 5. (1) When the examination will be conducted by an auditor solely on behalf of this  
state, or with at least 1 other state, the administrator shall notify a person that the state intends to  
conduct an unclaimed property examination of that person. All of the following apply:  
(a) For examinations conducted solely on behalf of this state, the examination authorization  
notice shall be sent from the administrator directly to a corporate officer or the resident agent of  
the person subject to examination. Both of the following apply:  
(i) The notice shall state that the state will conduct an examination of the person and shall  
provide the name of the authorized auditor that will conduct the examination.  
(ii) The notice shall include the telephone number and address of the administrator or his or  
her designee and shall state that the administrator or his or her designee will address any  
questions that the person may have regarding the examination.  
(b) For examinations conducted by this state and at least 1 other state, the administrator  
shall send an examination authorization notice directly to the auditor. All of the following apply:  
(i) The multistate audit notice will occur when the auditor has collected authorizations from  
the participating states and provides them to the person subject to examination.  
(ii) The examination authorization notice shall contain the telephone number and address of  
the administrator or his or her designee. The notice will contain a copy of the third party  
authorization signed by the administrator or his or her designee.  
(iii) Nothing contained in this rule shall be construed to prohibit other states from  
participating in the multistate audit where the person subject to the examination agrees to allow  
such participation.  
(2) For purposes of a streamlined audit, notice is not completed until the person subject to  
examination receives both the notice of commencement of the examination and a proposed  
nondisclosure agreement. The auditor and the person subject to examination shall make a good  
faith effort to reach agreement on a nondisclosure agreement within 30 days after receipt of the  
notice of commencement of the examination and a proposed nondisclosure agreement.  
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History: 2017 AACS.  
R 567.6 General professional standards for conducting an examination.  
Rule 6. Auditors shall adhere to the following general standards:  
(a) Auditors shall maintain independence and objectivity in all matters relating to the  
examination and shall not engage in any activity that gives the appearance of a conflict of  
interest.  
(b) Auditors shall use professional judgment in planning and performing examinations.  
(c) Auditors shall adhere to, where applicable, generally accepted auditing standards and  
follow generally accepted practices with regard to unclaimed property examinations.  
(d) Auditors shall possess adequate professional competence needed to address the  
examination objectives and conduct the examination.  
(e) Before commencing the examination, auditors shall collectively possess the technical  
knowledge, skills, and experience necessary to competently conduct the examination.  
(f) Auditors shall maintain their professional competence through continued training and  
education.  
(g) Auditors shall possess a system of quality control to provide reasonable assurance that  
its personnel comply with professional standards and applicable legal and regulatory  
requirements.  
History: 2017 AACS.  
R 567.7 General fieldwork standards for conducting examination.  
Rule 7. Auditors shall adhere to the following fieldwork standards:  
(a) Auditors shall adequately plan the work necessary to address the audit objectives,  
including a proposed timeline for each segment of the examination, the proposed property types  
that will be examined, and the proposed documentation that the person subject to examination  
may need to provide. The timeline shall take into consideration whether the person subject to the  
examination intends to provide machine-sensible records and documentation. If access to  
machine-sensible records and documentation is not provided, the auditor may adjust the timeline  
to accommodate the format of the records and documentation.  
(b) Auditors shall obtain an understanding of the person’s internal controls that are  
significant within the context of the examination objectives.  
(c) Auditors shall obtain a sufficient understanding of the person’s organization in order to  
design an examination plan specific to the person being audited.  
(d) Auditors shall be familiar with the state’s unclaimed property laws, regulations, case  
law, and reporting requirements.  
(e) The personnel conducting the examination shall be properly supervised. Supervision  
includes all of the following:  
(i) Providing sufficient guidance and direction to personnel assigned to the examination to  
address the examination objectives and follow applicable requirements.  
(ii) Being informed about significant problems encountered in the examination.  
(iii) Reviewing the work performed.  
(iv) Providing effective on-the-job training.  
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(v) The nature and extent of supervision may vary depending on a number of factors,  
including the experience of the personnel assigned to conduct the examination.  
(f) Auditors shall prepare examination documentation in sufficient detail to enable an  
experienced auditor, having no previous connection to the examination, to understand the basis  
of the examination findings from the documentation of the work performed, the property types  
reviewed, any estimation techniques used, and calculations made which formed a basis for the  
examination findings.  
History: 2017 AACS.  
R 567.8 Auditor contracts.  
Rule 8. (1) An auditor shall provide the person subject to examination with a copy of the  
auditor’s contract with the state at the examination entrance conference, if the examination is  
conducted by an auditor that is not an employee of the state.  
(2) If the person subject to examination believes that the auditor has not complied with the  
contract or the examination standards, and that noncompliance has or is likely to materially  
affect the results of the examination, the person should notify the administrator.  
(3) The administrator shall monitor auditor contracts and confirm compliance with the  
provisions of the contract and with the audit standards.  
(4) The administrator shall investigate any complaints regarding an auditor that are received  
from a person subject to an examination.  
(5) If the administrator determines that the auditor has not conducted an examination in  
material compliance with the examination standards, the contract, or the act, and the  
administrator believes that the auditor cannot conform its conduct to the standards, contract, or  
the act, the administrator may replace the auditor with another auditor to complete the  
examination.  
History: 2017 AACS.  
R 567.9 Examination entrance conference.  
Rule 9 (1) The administrator shall determine before or as part of the entrance conference  
whether the person is an “eligible holder,” the basis for that determination, and whether the  
person has elected to follow the streamlined audit process. All of the following apply:  
(a) If the eligible holder claims its status based on a percentage of payroll or percentage of  
real and tangible personal property, except inventory, owned or rented in this state, the  
percentage must be 20% or greater than the percentage in paragraph (i) or (ii) of this subdivision:  
(i) The numerator is the aggregate Michigan payroll during the entire 4 years that follow the  
dormancy period and the denominator is the aggregate of all payroll during the entire 4 years that  
follow the dormancy period.  
(ii) The numerator is the aggregate of all Michigan real and tangible personal property,  
except inventory, owned or rented in Michigan during the entire 4 years that follow the  
dormancy period and the denominator is the aggregate of all real and tangible personal property,  
except inventory, owned or rented everywhere during the entire 4 years that follow the dormancy  
period.  
(b) If the eligible holder claims its status based on employment in this state of the majority  
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of officers that direct, control, and coordinate the activities of the business, the percentage must  
be greater than 50% where the numerator is the aggregate number of days all officers were  
employed in this state during the entire 4 years that follow the dormancy period and the  
denominator is the aggregate number of days all officers were employed anywhere during the  
entire 4 years that follow the dormancy period. For purposes of this subrule, a “day” includes  
any part of a calendar day.  
(c) An eligible holder wholly owns a subsidiary corporation in this state if it directly owns  
100% of the subsidiary corporation or if it owns 100% of the subsidiary corporation through 1 or  
more wholly owned intermediate subsidiaries.  
(2) If the person subject to examination disputes the determination that it is not an “eligible  
holder,” the person may request a redetermination by the administrator. Within 30 business  
days of the determination, the person shall provide the basis for disputing the determination and  
may provide additional supporting information to the administrator. Within 30 business days of  
receipt of request for redetermination, the administrator shall determine if the person is an  
eligible holder and shall notify the person of the decision. If the administrator is not able to  
provide a response within 30 business days, the administrator will provide the requestor with the  
expected date for a response, not to exceed 15 business days.  
(3) The auditor shall contact the person subject to examination to schedule an entrance  
conference within 30 days from the date of the notice provided in R 567.5. At this time, a  
proposed confidentiality agreement shall also be provided to the person subject to examination.  
If contact with the person subject to the examination is not made within 30 days, the auditor shall  
notify the administrator or his or her designee to explain the cause for delay.  
(4) At the entrance conference, the auditor shall provide the person the following  
information:  
(a) Identification of the states participating in the examination.  
(b) A description of the components and stages of the examination.  
(c) Expected duration of the examination.  
(d) A description of the respective responsibilities of the person subject to examination and  
the auditor.  
(e) Identification of the potential types of property that may be subject to examination.  
(f) An initial records request.  
(g) Identification of the time period that is subject to examination.  
(h) The applicable dormancy periods for each property type subject to examination as well  
as the statutory citations that govern the dormancy period for each property type.  
(i) Explanation of the principles of unclaimed property law, applicable case law, and the  
process of reporting property to multiple states.  
(j) Explanation of the examination methods, including estimation techniques that may be  
used by the auditor for those periods where records are not available or are insufficient.  
(k) A document that summarizes the items discussed at the examination entrance  
conference.  
History: 2017 AACS.  
R 567.10 Good faith.  
Rule 10. The auditor and the person subject to examination shall act in good faith to conduct  
the examination under the terms and within the time frame established in the entrance  
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conference.  
History: 2017 AACS.  
R 567.11 Confidentiality.  
Rule 11. (1) The auditor shall ensure that all nonpublic records obtained from the state and  
the person subject to examination are confidential records.  
(2) Auditors shall not disclose confidential information obtained during the audit to any  
person other than to the administrator or his or her designee and, in the case of a multistate  
examination, to authorized representatives of a state participating in the examination but only to  
the extent such confidential information relates to property that may be subject to reporting in  
such state.  
(3) Auditors shall not use confidential information obtained from the person subject to an  
examination for any purpose other than for purposes of the examination. Auditors shall take all  
reasonable steps to ensure that the confidential information provided by the person subject to an  
examination is securely maintained.  
(4) An auditor and a person subject to examination may enter into a mutually agreeable  
nondisclosure agreement. However, if the person and the auditor are unable to enter into a  
mutually agreeable nondisclosure agreement within 30 calendar days from the date the  
agreement was first presented by the auditor to the person subject to the examination, then the  
examination shall commence without an agreement in place subject to subrules (1) to (3) of this  
rule.  
(5) The auditor must promptly cure any deficiencies and comply with any applicable federal  
and state laws and regulations pertaining to unauthorized disclosures. The administrator and the  
auditor will cooperate to mitigate, to the extent practicable, the effects of any breach, intrusion,  
or unauthorized use or disclosure. The auditor must report to the administrator in writing any use  
or disclosure of confidential information, whether suspected or actual, other than as required by  
the contract within 10 days of becoming aware of the use or disclosure or the shorter time period  
as is reasonable under the circumstances.  
History: 2017 AACS.  
R 567.12 Records format.  
Rule 12. (1) In order to conduct the examination efficiently, a searchable machine-sensible  
record is preferred. The person subject to examination may provide information in an alternative  
format such as hardcopy, microfilm, microfiche, or other storage-only imaging systems in the  
form of a machine-sensible record. The auditor may adjust the timeline for the examination if a  
searchable machine-sensible record is not provided.  
(2) For purposes of examining accounting records, machine-sensible records shall be  
capable of being retrieved and converted to a standard record format, such as, but not limited to,  
chart of accounts, income statement, balance sheet, account ledgers, and bank reconciliations.  
The person subject to examination is not required to retrieve and convert machine-sensible  
records other than those created in the ordinary course of business.  
(3) All hardcopies and data stored on microfilm, microfiche, or other storage-only imaging  
systems shall be provided in a manner that allows the auditor to locate any particular record.  
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History: 2017 AACS.  
R 567.13 Remediation.  
Rule 13. (1) After the compilation of the preliminary findings from an examination, the  
auditor shall provide a copy of the findings to the person subject to examination and a notice that  
a remediation period of 120 days begins upon receipt of the findings. During the remediation  
period, the property presumed abandoned may be remediated from the preliminary findings by  
providing documents to the auditor that include 1 or more of the following:  
(a) Documentation of accounting or data entry error.  
(b) Documentation that the last known owner address is not in this state or that the owner  
address is unknown and the person subject to an examination is not domiciled in this state.  
(c) Documentation from the presumed owner indicating that the property is or is not owned  
by that person.  
(d) Documentation of transactions or other activity by an owner that establishes that the  
property has not been abandoned.  
(e) Documentation showing that the apparent liability has been satisfied.  
(f) Documentation that the obligation did not exist or is not fixed and certain.  
(g) Other documentation that proves that the property is not subject to or presumed  
abandoned under the act.  
(2) Remediation documentation shall be provided to the auditor conducting the examination  
within the 120 day remediation period unless the auditor grants an extension of the remediation  
period. Extension of the period shall be granted where the person has made a good faith effort to  
provide the documentation as described in subrule (1) of this rule.  
(3) Within 30 days of the expiration of the original or extended remediation period, a  
closing conference shall be held between the auditor and the person subject to an examination at  
which time the total unclaimed funds reporting liability resulting from the examination shall be  
calculated.  
History: 2017 AACS.  
R 567.14 Examination report.  
Rule 14. (1) The examination report shall be filed by the auditor with the administrator or  
his or her designee within 45 days following the closing conference with the person subject to  
examination.  
(2) During the time period described in subrule (1) of this rule, the auditor shall adjust the  
calculation of the potential amount of property due based on any additional information  
presented to the auditor at the closing conference.  
(3) A copy of the examination report shall be provided to the person subject to the  
examination.  
History: 2017 AACS.  
R 567.15 Subsequent examinations.  
Rule 15. (1) Upon acceptance of the audit report by the administrator and receipt of the  
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property or amount deliverable, at the administrator’s discretion, the administrator shall not  
conduct or authorize a subsequent examination of the person for the property types and time  
periods covered in the examination.  
(2) Intentional misrepresentation, evasion, or fraud on the part of the person will void any  
such agreement.  
History: 2017 AACS.  
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;