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FBAR: 5 Critical Filing Tips for Treasury Professionals

  • By Andrew Deichler
  • Published: 4/19/2016

FORT WORTH, Texas -- Foreign bank account ThinkstockPhotos-518674512reporting (FBAR) has proven to be a major source of confusion and frustration for many treasury departments. During a session Monday at the TEXPO 2016 finance and treasury management conference, experts provided five key tips for treasury professionals filing an FBAR. 

  • Do not delay filing for FBAR individuals. Individuals must file for 2010-2016 by April 15, 2017. If they delay, there will be steep penalties, noted Andrew O’Garro, vice president of Axletree Solutions. For violations deemed to be willful, the penalty is the greater of either $100,000 or 50 percent of the account. If deemed non-willful, the penalty is $10,000. Lastly, any criminal intent associated with the failure to file an FBAR will result in up to $250,000 in fines, five years in prison, or both.
  • Get a bank account management (BAM) system if you have more than six banks and 100 accounts. Craig Jeffery, CCM, AAP, managing partner for Strategic Treasurer, stressed that Excel is not adequate for keeping track of this many accounts; a BAM system is much more efficient. “Get it if you’re at that level,” he said. “Whether it’s separate, standalone or part of your treasury management system, get it.”
  • Perform an audit. “If you’re uncertain about who needs to file an FBAR, as well as any restrictions around FBAR filing, make sure you perform an audit to see what needs to be done and when,” said O’Garro. Jeffery added that sometimes during an audit, you may find you have some issues to resolve, such as accounts that were supposed to be closed and never were. “You’ll say, ‘Why didn’t they close it?’ Well, they didn’t know how to close it. Maybe they emailed someone and nobody responded, so it sat open, and services remained open and you’re paying for those,” he said.
  • Get 100 percent visibility. Jeffery stressed that if you need a bank account, you need full visibility into it. “You need to have bank information reporting on it,” he said. “Every bank account is a point of expense. It’s a point of exposure. Having information reporting on a bank account is a minimum standard of control.”
  • If you don’t have a bank account policy, put one in place, O’Garro stressed. Furthermore, it needs to be formal. “Make it formal, so that you know exactly who has authority for opening accounts, who has authority for signing on accounts and the period in which they’re actually signers,” he said. “Put this policy in place if you don’t have one.”

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