PSI Virginia Real Estate Practice Exam

What is an agent required to report to the principal?

1. All sale prices achieved by the agent

2. All money and property received and paid out

3. Customer complaints or concerns

4. Personal expenses incurred during negotiations

The correct answer is: All money and property received and paid out

The requirement for an agent to report all money and property received and paid out stems from the fiduciary duty that the agent has towards the principal. This duty entails a high level of trust, loyalty, and confidentiality, necessitating complete transparency regarding any financial transactions related to the principal's interests. By reporting all funds and property received or disbursed, the agent ensures accurate accounting and maintains the principal's informed status about their finances, which is crucial for effective decision-making and trust in the agent's services. In the context of the other choices, while reporting customer complaints or concerns might be useful for maintaining good relations and communication, it is not as fundamentally tied to the fiduciary responsibilities as financial reporting. Similarly, tracking personal expenses incurred during negotiations is more about the agent's management of their business and not directly related to their obligation to inform the principal. Lastly, although keeping an account of sale prices achieved can be informative for the principal, it does not hold the same weight as the obligation to report all monetary transactions, which directly affects the financial outcomes for the principal.