SCHEDULE 1 FORM OF ACCOUNTANT S REPORT - CLC · SCHEDULE 1 FORM OF ACCOUNTANT’S REPORT Accounts...

SCHEDULE 1

FORM OF ACCOUNTANT’S REPORT

Accounts Code

Every Manager and CLC Body (which includes a Recognised Body and a Licensed Body) that holds or receives client money must produce annually to the CLC an Accountant’s Report in respect of each Accounting Period completed by an Accountant qualified under requirements 16.6-16.7 of the Accounts Code to show compliance by every Manager and CLC Body with requirements 1-15 of the Code.

The report must be delivered once during each practice year (i.e. between 1 November and the following 31 October)

When a Manager retires from practice (or for any reason stops holding or receiving client money), he or she is obliged to deliver an Accountant’s Report.

Any individual held out as a partner, director, member or sole principal in a CLC Body is a Manager. Any Manager whose name is included in the list of partners on the firm’s letterhead, even if the name appears under a separate heading of ‘salaried partner’, ‘associate partner’ or ‘limited partner’, must be included in this report.

Please complete in block capitals.

CLC Body Name (the subject of this report)

(“the CLC Body”)

If this Report relates to a limited company or to a limited liability partnership, the full registered name must be given (if applicable).

Company Number as registered at Companies House

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Accounts Code

MANAGERS Full name(s) of all Managers (include all licensed conveyancers, solicitors and managers who are not legally qualified) holding client money during the Accounting Period:

FULL NAME

PROFESSIONAL STATUS

LICENCE NO.

2 TRADING NAMES & ADDRESSES

Trading names and addresses of the CLC Body covered by this report. All addresses at which the CLC Body practises must be covered by an Accountant’s Report or Reports. (If an address is not covered the reason must be stated]. Please list on a separate sheet all other offices not covered by this report, with a short explanation as to why they are not covered by the report).

1. Address (Main Office) 2. Other Office

Trading name if different from name on Page 1


3. Other Office 4. Other Office



(continue on a separate sheet if necessary)

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3 ACCOUNTING PERIOD

Accounting Period complying with the CLC Handbook definition (this is a 12 month period unless a variation has been previously authorised in writing by the CLC):

Beginning

Ending

4 CEASED HOLDING CLIENT MONEY The following Managers ceased to hold client money during the Accounting Period on the date stated below and in respect of these Managers this report covers the Accounting Period up to that date.

Name of Manager

Licence or Practising Certificate Number

Date ceased to hold client money

5 HOLDING CLIENT MONEY

The following Managers joined the CLC Body during the Accounting Period on the date stated below and in respect of these Managers this report covers the Accounting Period from the date on which client money was held by them. Name of Manager

Licence or Practising

Certificate Number

Date started to hold client money

If the CLC Body ceased to hold client money indicate that date here: The Report will cover the period up to this date of cessation.

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Accounts Code

6 PLEASE TICK APPLICABLE BOXES As required by Section 22 of the Administration of Justice Act 1985 and the Accounts Code, I have examined to the extent required by requirements 16.11-16.12 of the Code, the Accounting Records produced to me in respect of the CLC Body. In so far as an opinion can be based on this limited examination, I am satisfied that during the Accounting Period the CLC Body has complied with the provisions of requirements 1-15 of the Code except so far as concerns:-

(a) certain trivial breaches due to clerical errors or mistakes in book-keeping, all of which were rectified on discovery and none of which, I am satisfied, resulted in any loss to any client.

(b) the matter(s) set out at 9 below in respect of which I have not been able to satisfy myself for the reasons therein stated.

(c) the matter(s) set out at 10 below in respect of which it appears to me that the CLC Body has not complied with the provisions of requirements 1-15 of the Code.

(d) none of the above. 7 COMPARISON DATES The results of the comparisons required under section 13 of the Accountant’s Report Checklist, at the dates selected by me were:

(a) At: (insert date 1)

(i) Liabilities to clients as shown by client ledger accounts (ii) Cash held in client account(s), and client money held

elsewhere other than in a client account, after allowances for lodgements cleared after the date and for outstanding cheques

(iii) Difference between (i) and (ii) (if any – details required at section11 below)

£

£

£

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Accounts Code

COMPARISON DATES (Continued)

(b) At: (insert date 2)

(i) Liabilities to clients as shown by client ledger accounts (ii) Cash held in client account(s), and client money held

elsewhere other than in a client account, after allowances for lodgements cleared after the date and for outstanding cheques

(iii) Difference between (i) and (ii) (if any – details required at section 11 below)

£

£

£

Note: The figure shown in section 7(a)(i) and Section 7(b)(i) above is the total of all credit balances, without adjustment for/or deduction of any debit balances (unless capable of proper set-off being in respect of the same client), or for receipts and payments not capable of allocation to individual ledger accounts.

8 QUALIFIED REPORT

Have you found it necessary to qualify this report other than for trivial Breaches? Please tick yes or no. Yes

If ‘Yes’ please complete section 9 and/or 10 below. If ‘No’ proceed to Accountant’s Certificate. No

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9 Matters in respect of which the Accountant has been unable to satisfy himself and the reasons he has been unable to do so.

(continue on separate sheet if necessary)

10 Matters (other than trivial breaches) in respect of which it appears to the Accountant that the CLC Body has not complied with the Accounts Code.


11 Details of the causes of any differences shown at section 7(a)(iii) and/or section 7(b)(iii) above.


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Accounts Code

Accountant’s Certificate

1

2

3

4

I confirm that I hold a copy of the CLC Accounts Code, the CLC Code of Conduct and the Recognised Body Operating Framework (if the CLC Body is a Recognised Body) or the Licensed Body (ABS) Licensing Framework (if it is a Licensed Body).

I acknowledge that under requirements 16.11-16.12 of the Code I am required to report to the CLC whether the CLC Body has complied with requirements 1-15 of the Code and to report to the Council any non compliance with those requirements. I confirm that I am the Reporting Accountant and as required by the Code, I have examined to the extent required by requirements 16.11-16.12 of the Code, the Accounting Records produced to me in respect of the CLC Body.

Please tick one of the following boxes:

I confirm that a copy of this Report has been sent to each of the Managers to whom this Report relates.

I confirm that one copy of this Report has been sent to the following Manager on behalf of all of the Managers of the CLC Body :

…………………………………………………………

5

6

7

I acknowledge that information contained in the Accountant’s Report on pages 1 to 7 (and in any continuation sheets) will be relied upon by the CLC and that I owe a duty of care to them in the preparation of this Report. I confirm that a Letter of Engagement has been entered into between my firm and the CLC Body incorporating without amendment, limitation or qualification of the terms set out at requirement 18 of the Accounts Code. I confirm that this is a true and complete copy of the Accountant’s Report Form appended to the Accounts Code or as downloaded from the CLC website and has not been amended in any manner whatsoever. (Please delete if not applicable.)

Reporting Accountant’s Full Name

Do you have a current Practising Certificate?

Accountant’s Qualifications & YES NO Professional Body & Membership No.:

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Accounts Code

Note: The reporting Accountant must be qualified in accordance with requirements 16.6-16.7 of the Accounts Code

Name and Address of the Reporting Accountant’s Firm Please include e-mail address

Signature (A personal signature is required)

Date

Total number of pages of report submitted to the CLC (including continuation sheets)

Please return this completed form to: Council for Licensed Conveyancers Monitoring & Practice Support CAN Mezzanine 49-51 East Road London N1 6AH Or DX36603 FINSBURY

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CLC ACCOUNTS CODE

The following checks must be completed in order to satisfy the minimum examination requirements under requirement 16.11. Where

the result of the checks is found to be unsatisfactory, further details must be reported in section 2 of this checklist or on a separate

appendix as appropriate.

Name of Licensed Conveyancer(s)

Name of CLC Body

Results of test checks for all client money:

1

For the avoidance of doubt each of the questions should refer to

test examinations

Satisfactory (Tick

the appropriate

column)

If 'no' should breaches

be noted in the

Accountant's Report

Cross

references to

audit file

documentation

1

Book-keeping system for every office:

Yes

No

Yes

No

1.1

The accounting records clearly distinguish between client and office monies dealt

with by the firm.

1.2

A separate ledger account is maintained for each individual client (except in cases

referred to in 13.7) and the particulars of all client money received, held or paid on

account of each client, including funds held on separate designated deposits, or

elsewhere, are recorded.

1.3

The current balance on each client and office ledger account is always shown or is

readily ascertainable from the accounting records.

1.4

The current balance shown on each client and office ledger account is correct.

1.5

A central record or file of copies of all bills of costs has been retained on a durable

medium.

1.6

The firm has established and maintained proper accounting systems, procedures,

processes and internal controls to ensure compliance with the Accounts Code.

1.7

Where it is possible to ascertain, the firm has accounted to their Clients' as soon as

possible after completion of any transaction or after any retainers have been

terminated.

1.8

Where it is possible to ascertain, all monies held in client bank account have been

paid promptly to the Rightful Recipient when due.

2

Postings to ledger accounts and casts:

Yes

No

Yes

No

2.1

All dealings with client money have been appropriately recorded in a client cash

book or record of sums transferred from one client ledger account to another.

2.2

All dealings with client money have been appropriately recorded on the client side

of a separate client ledger account for each Client or each Client matter.

2.3

Casts of client ledger accounts and receipts and payments records are correct.

2.4

Postings have been recorded in chronological sequence with the date being that of

the initiation of the transaction.

3

Receipts and payments of client money:

Yes

No

Yes

No

3.1

Sample receipts and payments of client money as shown in bank and building

society statements have been compared with the records of receipts and payments

of client money and are correct.

3.2

The withdrawals from client bank account were made by payments other than in

cash (i.e. CHAPS, BACS, Cheques etc).

3.3

Sample paid cheques have been obtained and details agreed to payment records.

(Where paid cheques are retained by the CLC Body's Bank as referred to in

13.14.1, copies of the selected sample of paid cheques will need to be requested

from the Bank)

3.4

A test examination of client ledger accounts revealed that no withdrawals on behalf

of any client exceeded the total of the money held to the credit of that client.

3.5

If the test in 3.4 above revealed that withdrawals on behalf of a client exceeded the

total of the money held to the credit of that client, such overpayments were

corrected without delay.

3.6

Withdrawals from client bank account in respect of costs were properly required for

or towards payment of the firm's costs where there has been delivered to the client

a bill of costs or other written intimation of the amount of the costs.

3.7

Where money has been withdrawn from client bank account in respect of

disbursements, the withdrawal related to the reimbursement of money:- A) already expended by the CLC Body out of office account and evidenced on a

durable medium B) for which the CLC Body has incurred a liability to pay out of office account as

evidenced on a durable medium.


4

System of recording costs and making transfers:

Yes

No

Yes

No

4.1

The payments or liabilities mentioned in test 3.7 above were debited to the client

ledger before the monies were withdrawn from client bank account

4.2

Transfers between client and office bank accounts have been recorded in both the

client and office columns of the appropriate client ledger accounts.

4.3

The system of recording costs has been ascertained and is suitable.

4.4

The withdrawals from client bank account have been made by way of a cheque to

the CLC Body or by way of a transfer to the office bank account.

5

Examination of documents for verification of transactions

and entries in accounting records:

Yes

No

Yes

No

5.1

A test examination of a number of client files has been made.

5.2

All client files requested for examination were made available.

N.B. If (5.2) above is unsatisfactory have details been provided in the

Accountant's Report? Yes No (tick appropriate box)

5.3

The financial transactions evidenced by documents in the client files were correctly

recorded in the books of account in a manner complying with the Code.

6

Office accounts:

Yes

No

Yes

No

6.1

Check such client office ledgers, cash books and bank and building society

statements as the CLC Body maintains with a view to ascertaining whether any

client money has not been paid into a client account.

6.2

Investigate client office ledger credit balances and ensure that such balances do

not include client money incorrectly held in office account.

6.3

In the event of client office ledger credit balances existing on client ledger

accounts, the firm has investigated them and corrected the position without delay.

7

Client money not held in client account:

Yes

No

Yes

No

7.1

Has the CLC Body disclosed any dealings in which money has been withheld from

client bank account?

7.2

Has an appropriate written client instruction/acknowledgement or written

authorisation from the CLC been received in each instance?

8

Authorised Withdrawals from Client Bank Account(s):

Yes

No

Yes

No

8.1

Cheques or other written instructions for withdrawal from Client bank account have

been signed by an Approved Person.

8.2

Where CHAPS terminals or other electronic systems have been used to withdraw

monies from client bank account the system has been operated by an Approved

Person, or authorised electronically by an Approved Person.

9

Client to Client Transfers:

Yes

No

Yes

No

9.1

All transfers of money from the ledger account of one Client to that of another

Client have been effected in accordance with the Rules.

10

Client ledger for Borrower and Lender:

Yes

No

Yes

No

10.1

When acting for both lender and borrower in a mortgage transaction between them

and separate client ledger accounts for both Clients have not been opened, the

funds belonging to each Client are clearly identifiable.

11

Deposit Interest:

Yes

No

Yes

No

11.1

Where appropriate, the firm has accounted to clients' for interest earned in

accordance with the Code.

12

Information and Explanations:

Yes

No

Yes

No

12.1

All records and explanations required have been received and satisfactorily

cleared.


13

Reconciliations and extraction of client ledger balances:

Yes

No

Yes

No

13.1

The client bank reconciliation, extraction of client and office ledger balances and

comparison between liabilities to clients and cash available has been checked on

no fewer than two separate dates in the period subject to this report.

The following tests relate to the dates selected in (13.1) above

13.2

All accounts, disclosed by the firm or the firm's Bank's, containing client money

have been included in the reconciliation.

13.3

The client bank reconciliation total is complete and correct having being calculated

by:- the closing client bank account balance plus an accurate and complete list of

outstanding lodgements less an accurate and complete list of unpresented

cheques.

13.4

The cash book balances at each of the dates selected have been reconciled to the

balances in client account and elsewhere as confirmed directly by the relevant

banks and building societies.

13.5

The client cash account balance is correctly calculated by the accurate and prompt

recording of transactions.

13.6

All client ledger account balances as at the reconciliation date have been listed and

totalled and no debit balances have been included in the total.

13.7

The total liabilities to clients as shown by such ledger accounts has been compared

to the balance on the bank reconciliation statement and agreed.

13.8

Where the comparison in 13.6 and/or 13.7 shown above revealed differences, a

reconciliation statement showing the cause of the differences had been prepared.

13.9

In the event of debit balances existing on client ledger accounts, the firm has

investigated them and corrected the position without delay.

13.10

In the event of the reconciliations selected not being in agreement, the differences

have been investigated and corrected promptly.

13.11

The reconciliations were completed within 7 days of the reconciliation date to which

they relate.

13.12

Each reconciliation selected has been achieved by the comparison and agreement

without adjusting or balancing entries of the: Client ledger balances total; Client cash book(s) balances total;

Client bank accounts total.

The following tests relate to a further sample of reconciliation statements:

14.1

Reconciliations have been carried out at least once in each calendar month.

14.2

All client reconciliations were prepared to a date not more than five weeks after the

date to which they were last prepared.

14.3

Each reconciliation is in the form of a statement set out in a logical format which is

likely to reveal any discrepancies.

14.4

The client bank reconciliation total has been compared with the balance on the

client cash book(s).

14.5

The total of the client ledger credit balances has been compared with the balance

on the client bank reconciliation statement.

14.6

Reconciliation statements have been retained on a durable medium.

14.7

In the event of the reconciliations selected not being in agreement, reconciliation

statements showing the cause of the differences have been prepared and the

differences have been investigated and corrected promptly.

Explanation of the use of terms

1.7 "As soon as possible" - this term implies that payment was made when the funds became due to the Client taking into account any practical

or other reasons why the funds could not be paid "without delay".

1.8 "Promptly" - this term implies that payment was made when the funds became due to the Rightful Recipient taking into account any practical

or other reasons why the funds could not be paid "without delay".

6.3 “Working Day” – is defined as “any day from Monday to Friday (inclusive) which is not Christmas Day, Good Friday or a statutory bank holiday.

13.5 "Prompt" - this term implies that the books of account have been written up to ensure that they always show clearly all dealings with Client and Office Money.

Please give further details of unsatisfactory items in Section 2 over the page.


2. Further details of unsatisfactory items (Please attach additional schedules as required).

Signature: Date:

Name of Reporting Accountant:

SCHEDULE 1 FORM OF ACCOUNTANT S REPORT - CLC · SCHEDULE 1 FORM OF ACCOUNTANT’S REPORT Accounts...

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