5 GOLDEN Solicitors Accounts Rules
SARs are the bane of many a solicitors life. The latest manual – edition 10, of Solicitors Accounts Rules (SAR’s) was published in October 2007. Every fee earner and member of the accounts team should have their own copy or at least have direct access to a copy of it. It shouldn’t be used as a doorstop, but should be very tatty around the edges, due to the constant thumbing through it.
No doubt some folk will find it a riveting read. The rules are all explained in legal language, and we wouldn’t recommend it’s read from cover to cover in one sitting, but in chunks, bit by bit. In fact, if you subscribe to our newsletter, that is just what we do – every month, in simple language, we take one of the rules, and break it down.
We don’t want to send anyone to sleep on this page, so
we’re just going to take a look at the first rule – rule number one, and then
we highlight the top 5 rules we think should be at the forefront of your mind.
Rule 1 states:
“A solicitor must: -
a) Comply with requirements of practice rule 1 as to the solicitor’s integrity, … act in the client’s best interest and the good repute of the solicitor …and profession;
b) Keep other peoples’ monies separate from the solicitors’;
c) Keep other peoples’ monies safely in a Bank or Building society;
d) Use each Client’s monies for that Client’s matters;
e) Use Controlled Trust Money for the purposes of that trust;
f) Establish and maintain proper accounting systems and internal controls to ensure compliance
g) Account for interest in other people's monies in accordance with the rules;
h) Co-operate with the Society in checking compliance (with the rules); and
i) Deliver an annual Accountants Report as required bu the rules."
Five golden rules:
- The Client Account should never be overdrawn
- Cheques should be Banked Immediately (By Next Working Day)
- The Office Account Should Never Be In Credit
- Money In The Client Account Must Be Transferred To Pay Outstanding Bills Within 14 Days Of Receipt
- Interest Must Be Paid To The Client, in accordance with the firms practise