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New Solicitors Accounts Regulations

Updated: Nov 8, 2023

The Law Society has published new Solicitors Accounts Regulations which come into operation on 1 July 2023 replacing the current regulations issued in 2014.


The key impacts on the reporting accountants under the new regulations are as follows:

  • Reporting accountant’s reports are to be filed within five months of the accounting date (under the current regulations this is six months).

  • Reporting accountant to test check postings before and after accounting date (hence expanding the work remit of the reporting accountant).

  • Reporting accountants to test check that withdrawals of fees are notified to the clients.

  • Reporting accountants should consider reporting directly to the Law Society, an opinion or a suspicion of a deficit, rather than waiting to submit an annual report.

  • Closing reporting accountant’s reports are to be filed within three months of cessation (two months are current regulations).

  • Reasons are to be provided for withdrawal of approval of a Reporting accountant.

  • A listing of client ledger balances outstanding two years or more is to be prepared by the accounting date and furnished to the Law Society by the Reporting Accountant.


The new regulations impose a raft of new regulations for solicitors which relate to the Reporting Accountant, with a summary of the notable matters as follows:


  • Client ledger balances are to be reviewed for undue or unnecessary delays in discharging client monies and immediate action taken to clear same, where appropriate.

  • Compliance Balancing statements are to be prepared at quarterly intervals in respect of client account transactions (under the current regulations this is at six-month intervals)

  • Compliance partner is to provide specific confirmation to the Law Society, through the Form of Acknowledgement, of compliance with the regulations in respect of balancing statements, balances outstanding two years or more, review of client ledger balances for undue or unnecessary delays and back up of computerized accounting systems.

  • A listing of client ledger balances outstanding two years or more is to be prepared by the accounting date and furnished to the Law Society by the Reporting Accountant.

  • It is no longer a requirement to open a separate bank account where a solicitor is acting as personal representative of an estate.

  • Balancing statements are to be prepared at quarterly intervals in respect of client account transactions (under the current regulations this is at six-month intervals).

  • Client ledger balances are to be reviewed for undue or unnecessary delays in discharging client monies and immediate action taken to clear same, where appropriate.

  • A listing of client ledger balances outstanding two years or more is to be prepared by the accounting date and furnished to the Law Society by the Reporting Accountant.

  • Clients are to be furnished with a statement of account in respect of each matter.

  • Client monies are to be returned to clients when the legal service is completed.

  • Evidence of payments in cash is to include the witnessed signature of the recipient.

  • Transfers of funds from client to office account are to be related to specific clients.

  • The Law Society is to be notified of a deficit that cannot be rectified within seven days of the deficit coming to the solicitor’s attention.

  • Cheque signatories or transaction authorizers on the client account are to include a solicitor who is a partner or a sole practitioner with a current practicing certificate.

  • The register of undertakings and of funds held on joint deposit are to be maintained.

  • A file of documents or record in respect of electronic transfers to be maintained.

  • Compliance partner is to provide specific confirmation to the Law Society, through the Form of Acknowledgement, of compliance with the regulations in respect of balancing statements, balances outstanding two years or more, review of client ledger balances for undue or unnecessary delays and back up of computerized accounting systems. This is part of the submission of the Reporting Accountant’s Report by the reporting accountant.

  • Client accounts are not to be used for the purpose of borrowing from, lending to, or organizing loans between clients.

  • Client accounts are not to be used to hold monies other than in respect of legal services provided.

  • Client accounts are not to be used to hold, or to pass through, solicitors’ personal moneys.

  • Responsibility for breach of the regulations extends to the solicitor responsible for the actual breach, and not just the principal or partners of the firm.


The full text of the new regulations is available here.


Implementation dates


The new regulations will take effect for solicitor firms with accounting periods commencing on/after 1 July 2023. In respect of solicitor practice accounting years commencing before this date, the current regulations still apply as referenced here.



For further information regarding solicitor accounts regulations and the reporting requirements, please contact our team at Company Auditor 4U Ltd for professional advice.


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