Client account reconciliation: quick reference

Key reconciliation obligations, reporting triggers, and deadlines under the SRA Accounts Rules 2019.

Five-weekly reconciliation

Requirement	Detail
Frequency	At least every five weeks (Rule 8.3)
What to compare	Client account bank statement balance, total of all individual client ledger balances, and cash book balance
Differences	Investigate and resolve promptly; document findings
Retention	Reconciliation statements and working papers kept for at least six years

Central record keeping

Record	Minimum retention
Client ledger accounts	Six years from last entry
Bank statements (client accounts)	Six years
Reconciliation statements	Six years
Bills and costs notifications	Six years
Withdrawal authority evidence	Six years

SRA reporting triggers

You must report to the SRA promptly if any of the following arise:

Shortfall on client account that cannot be replaced immediately
Improper withdrawal from client account
Failure to carry out five-weekly reconciliation
Material differences identified during reconciliation that cannot be resolved
Qualified accountant's report identifying non-trivial departures from the rules

Accountant's report deadlines

Obligation	Deadline
Obtain accountant's report	After each accounting period in which client money was held or received
Deliver qualified report to SRA	Within six months of the end of the accounting period
Clean report	Retain on file; no delivery to SRA required

COFA responsibilities

Responsibility	Rule reference
Ensure firm complies with the Accounts Rules	SRA Authorisation of Firms Rules, Rule 8.5
Report material breaches to the SRA	SRA Code of Conduct for Firms, para 3.9
Maintain access to all financial records	SRA Accounts Rules, Rule 13
Oversee reconciliation process	SRA Accounts Rules, Rule 8.3
Register as COFA with SRA	SRA Authorisation of Firms Rules, Rule 8.5

COLP and COFA Roles and Requirements

Compliance Officer for Legal Practice (COLP) and Compliance Officer for Finance and Administration (COFA) requirements: appointment, eligibility, responsibilities, reporting obligations and record keeping under the SRA Standards and Regulations.

Every SRA-authorised firm must designate a Compliance Officer for Legal Practice (COLP) and a Compliance Officer for Finance and Administration (COFA). These roles were introduced by section 90 of the Legal Services Act 2007 for licensed bodies (alternative business structures) and extended by the SRA to all authorised firms through the SRA Authorisation of Individuals Regulations and the SRA Authorisation of Firms Rules. Both officers must be approved by the SRA before they can take up the role.

Who can be a COLP or COFA:

COLP eligibility: Must be a manager or employee of the firm. In most cases the COLP must be a lawyer (solicitor, REL, or barrister) or, in a licensed body, the Head of Legal Practice (HOLP). The COLP must have sufficient seniority and authority within the firm to fulfil the role effectively.
COFA eligibility: Must be a manager or employee of the firm. The COFA does not need to be a lawyer, but must be suitably experienced in financial management and compliance. In a licensed body, this role is the Head of Finance and Administration (HOFA). The COFA must be approved by the SRA.
COLP core responsibilities: Ensure the firm and its employees and managers comply with the SRA Standards and Regulations. Take all reasonable steps to ensure the firm's compliance with its regulatory obligations, including the terms and conditions of authorisation. Record all failures to comply and report material breaches to the SRA promptly.
COFA core responsibilities: Ensure the firm and its employees and managers comply with the SRA Accounts Rules 2019. Take all reasonable steps to ensure compliance with obligations relating to client money, including proper client account management, reconciliation, and financial reporting. Record all failures to comply and report material breaches to the SRA promptly.
Record keeping obligations: Both the COLP and COFA must maintain records of all failures to comply with the SRA Standards and Regulations (COLP) or the SRA Accounts Rules (COFA). These records must be available for inspection by the SRA at any time and must be maintained throughout the period of authorisation.
Reporting obligations: Material failures to comply must be reported to the SRA promptly by the COLP or COFA as appropriate. Annual compliance declarations must be submitted via mySRA as part of the firm's annual renewal process. Failure to report material breaches is itself a regulatory breach.
Change notifications: The firm must notify the SRA of any change of COLP or COFA, including resignation, replacement, or any event that affects the officer's ability to fulfil the role. The replacement must be approved by the SRA before taking up the role.

Practical implementation: The COLP should establish systems and controls for monitoring compliance across the firm, including regular file reviews, supervision arrangements, complaints handling procedures, and risk registers. The COFA should implement controls over client account operations including signatory arrangements, reconciliation timetables (at least every five weeks per the SRA Accounts Rules), and procedures for handling residual balances.

Sole practitioners: In a recognised sole practice, the sole practitioner is normally both the COLP and the COFA. They must still maintain compliance records and submit annual declarations to the SRA.

Consequences of non-compliance: Failure to maintain adequate compliance systems, to keep proper records, or to report material breaches can result in regulatory action against both the individual officers and the firm. This may include conditions on the firm's authorisation, a rebuke, a fine of up to GBP 25,000 (individuals) or referral to the Solicitors Disciplinary Tribunal. In serious cases, the SRA may intervene in the firm's practice under Schedule 1 of the Solicitors Act 1974.

For full procedural guidance, see Manage client money under SRA Accounts Rules.

Official sources

SRA Accounts Rules 2019 (full text)
Complete text of all 13 SRA Accounts Rules
sra.org.uk
SRA Standards and Regulations
Full index of SRA codes, rules, and regulations including accountant's report guidance
sra.org.uk
Solicitors Act 1974
Primary legislation governing solicitors' accounts in England and Wales
legislation.gov.uk

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Client account reconciliation: quick reference

Five-weekly reconciliation

Central record keeping

SRA reporting triggers

Accountant's report deadlines

COFA responsibilities

Compliance Assistant

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Five-weekly reconciliation

Central record keeping

SRA reporting triggers

Accountant's report deadlines

COFA responsibilities

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