Legal Accountants in Brighton
As you would expect from a firm of chartered accountants, we offer a comprehensive range of accounting and tax services for our clients that operate in the legal sector.
What makes us stand out from the crowd is our genuine interest in you and your business needs. We take time to understand what is important to you and then tailor our services to your requirements.
We understand the complexities of the legal sector and look to support firms with their SAR Audits, and we realise how vital it is to ensure a client feels they can trust you. We also appreciate that for solicitors handling client money, the safe-guarding of that money is key.
Here we outline how we can help you ensure you have the right systems and processes in place to achieve this.
What is a Solicitors Accounts Rules Audit?
The Solicitors Regulation Authority (SRA) requires authorised members**1 (hereafter referred to as members) to ensure they have robust systems and procedures in place to safeguard client money.
To help members, the SRA has a set of Accounts Rules around which systems, procedures and staff can be trained to ensure client money is kept safe and only used for the purpose for which it has been given to the member.
These rules are considered key to helping clients feel they can trust members to safeguard their money until their transaction is complete, such as for a property purchase, re-mortgage, business purchase and so on.
A Solicitors Accounts Rules Audit (SARA) is one of the ways in which the SRA monitors the rules and principles behind them.
Who needs an SAR audit (SARA)?
Currently members are required to obtain an Accountant’s Report if;
- They have handled client money in an accounting period. This means they have received or held money belonging to a client.
- Operated a joint account on behalf of a client by being a signatory
- Operated a client’s own account by being a signatory
Periodically, a SARA must be conducted by an accountant registered with one of the chartered accountancy bodies. The accountant is required to audit how the member is complying with the Accounts Rules, and depending on the findings, may have to report the member to the SRA. The accountant is required to complete an Accountants Report and ensure the member is aware of the contents and recommendations for improvements.
When is an Accountant’s Report not required?
There are some exceptions to the requirement to obtain an Accountant’s Report;
- All the client money received came from a Legal Aid Agency or,
- The balance held or received does not exceed an average of £10,000 and a maximum of £250,000. This amount is found by checking the balance of all client accounts held and operated by the member, including joint accounts and client’s own account operated by the member
- Both points above are applied to an accounting period
When is a ‘client account’ not required?
There are situations where a client account is not required, for example when funds are received in advance towards your fees or for disbursements for which you are liable, however there are strict criteria and you should check the rules/seek advice to ensure compliance.
**1 Members are those firms who have been authorised by the SRA to practice as a licensed body and also applies to a sole practitioner who the SRA has authorised as a recognised sole practice.
What to consider when completing your first SAR?
If it is the first time you have operated a client account, or you are now required to obtain an Accountant’s Report after previously being exempt, we can help you to review your systems and staff training to ensure you are complying with the relevant rules.
Our team can assess your existing systems and advise on areas for improvement or where you should set up a new process. Our experience of carrying out SAR audits puts us in a good position to help you and we ensure that the teams advising on your systems will be separate to those carrying out the SAR audit to maintain our independence during the audit process.
You can also find a lot of useful guidance available on the SRA’s website.
Are you already completing a SAR?
Even if you are used to the SARs and feel you have all the systems needed in place, it is worth carrying out periodic checks that all is working as it should be. Minor changes to the nature of services provided and changes in staffing, mean that you could need to update your processes, or just simply ensure that new staff are aware of how the SARs affect them.
The SAR audit is designed to check a sample of your system rather than the whole and ultimately you are responsible for ensuring that systems are effective enough to safe-guard client money at all times.
We can help you carry out an interim assessment of your systems, whether that be all processes or perhaps an area of particular concern.
If this sounds like the type of accountancy firm that you would like to work with, don’t just take our word for it, have a look at the testimonials from our clients.
Want to learn more?
Get in touch with our in house expert Helen Griffiths to see how we can help.
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