SRA Accounts Rules: common problem areas—applying the rules 2011 [Archived]
Produced in partnership with Taylor Mowbray LLP
SRA Accounts Rules: common problem areas—applying the rules 2011 [Archived]

The following Practice Compliance guidance note Produced in partnership with Taylor Mowbray LLP provides comprehensive and up to date legal information covering:

  • SRA Accounts Rules: common problem areas—applying the rules 2011 [Archived]
  • Key definitions and the problem of undisclosed profits
  • The ‘48 hour rule’
  • Appropriate bank accounts
  • Earmarking the firm’s fees and common questions arising
  • The prohibition on providing banking facilities through client account

This Practice Note looks at some of the more common problem areas in the detailed application of the SRA Accounts Rules 2011 (SRA AR 2011) which can result in misunderstandings and breaches.

SRA AR 2011 are highly prescriptive rules aimed at ensuring that client money is always protected to the fullest possible extent. Many of the rules are relatively straightforward and generally most firms have no real problems with compliance, except for some minor breaches.

Breaches or mistakes arise on a more regular basis in some areas of the rules because of a misunderstanding of the rules and how to apply them to ensure compliance.

The treatment of residual balances on client matters and the payment of interest due to clients are common problem areas. For more guidance see overviews: Residual balances and Payment of interest.

This Practice Note covers the following common problem areas:

  1. key definitions and the problem of undisclosed profits

  2. the ‘48 hour rule’

  3. appropriate bank accounts

  4. earmarking the firm’s fees and common questions arising

  5. the prohibition on providing banking facilities through client account

This Practice Note does not provide an exhaustive list of all the areas where questions, problems and breaches arise but it does deal with a number of the more common instances.

Key definitions and the problem of undisclosed profits

Understanding the definitions in SRA AR 2011 is critical