The last time the Missouri State Board of Embalmers and Funeral Directors took up the issue of preneed seller record keeping requirements, the staff proposal emphasized a contract ledger approach. The proposal sought to require a contract record that reflected the amount and date of each payment received and the corresponding dates and amounts deposited to trust, joint account or insurance. The ledger card would have to be maintained manually, and would be very burdensome for the funeral home that allows consumers to pay by installments. Ostensibly, the funeral home seller would be required to maintain a separate ledger card for each consumer, regardless of the method of funding.
In lieu of the ledger card approach, this author has proposed record keeping requirements to the State Board that would require one set of records documenting the funeral home’s receipt of consumer records by month and another set of monthly records documenting the transmission of consumer funds to the preneed funding agent. These types of records would serve as the starting point for a financial examination that would employ an audit trail to track consumer funds through the hands of the funeral director to the appropriate funding agent. The objective would be to determine that all consumer funds are being timely deposited with the funding agent.