Hui Juan Kang was the owner of the weatherboard house in Skipton Street, operating as a massage parlour, which was declared a prescribed brothel by the courts on October 4 of last year.

The 45-year-old woman charged over the Skipton Street brothel pleaded guilty to​ recklessly carrying on a business as a sex work service provider without a licence and ​dealing with property suspected to be proceeds ​of crime ​at the Ballarat Magistrates' Court on Thursday.

The court heard Ballarat police had conducted an investigation into the property where it was noted only male customers were entering and exiting the premises.

Two of the male customers told police they had paid money with the belief sexual services would be performed.

On September 22, police executed a Sex Work Act search warrant at the premises and located a female staff member naked in a room with a male customer naked on a bed.

The male told police he had attended in the past and received sexual services and on this occasion paid $60 with the expectations he would receive a massage with a "happy ending".

Police also found a number of sex toys and an appointment book with cash payments noted inside.

The following day a subsequent search warrant was executed at Kang's Sebastopol home where $4400 in Australian dollars and Chinese currency in a similar amount w​as​ found.

Kang made no admissions to police other than to say she was the manager and had told the female staff members they were only to perform massage services.

Kang's lawyer, Kellie Blair, told the court her client moved to Ballarat in 2011 where she opened the massage business.

But after her father, who lived in China with the rest of her family, became unwell Ms Blair said Kang left the business in the hands of a friend and during that time didn't pay much attention to what was going on.

She added although notices prohibiting sexual acts in the premises were hung in the common room, she said it was conceded her client knew there were sexual performances going on.

Since the business had been shutdown, Ms Blair said her client had no income.

Hopeful of gaining work, Ms Blair submitted a fine would be appropriate given her client's clean criminal history.

Magistrate Clive Alsop agreed, but he also made it clear to Kang the maximum sentence for this offending was five years' jail. Kang was convicted and fined $7500.