Specialist Audits - Solicitors Accounts Rules (SARs) 2011
The rules governing audits of solicitors’ client accounts were changed to an “outcomes-focussed” approach in 2011.
The Principles set out by the Solicitors Regulatory Authority (SRA) apply to all aspects of practice, including the handling of client money. These require solicitors to -
- protect client money and assets;
- act with integrity;
- behave in a way that maintains the trust the public places in you and in the provision of legal services;
- comply with your legal and regulatory obligations and deal with your regulators and ombudsmen in an open, timely and co-operative manner; and
- run your business or carry out your role in the business effectively and in accordance with proper governance and sound financial and risk management principles.
The desired outcomes which apply to these rules are that:
- client money is safe;
- clients and the public have confidence that client money held by firms will be safe;
- firms are managed in such a way, and with appropriate systems and procedures in place, so as to safeguard client money;
- client accounts are used for appropriate purposes only; and
- the SRA is aware of issues in a firm relevant to the protection of client money.
If at any time during an accounting period, a solicitor has held or received client money, or operated a client's own account as signatory, they must deliver to the SRA an accountant's report for that accounting period within six months of the end of the accounting period. This duty extends to the directors of a company, or the members of an LLP, which is subject to this rule.
The rules for auditing client accounts and the format of the report are detailed and stringent. A checklist to the approved SRA format must also be completed.
Taylorcocks has the expertise to carry out the specialist audits, to identify any apparent or potential risks and prepare the prescribed reports for the SRA. If you would like to talk to one of our SRA experts please contact us for a consultation.