Solicitors Accounts (SRA)
THE SOLICITORS REGULATION AUTHORITY (SRA)
What is the Solicitors Regulation Authority? (SRA)
The Solicitors Regulation Authority was established in 2007 to act as an independent body to regulate how Solicitors conduct themselves as a profession and how they deal with their clients. They monitor both firms and individual solicitors as well as Alternative Business Structures. They were set up to give the general public confidence that Solicitors would be brought to account should they fail in their duty towards their clients. The Solicitors Regulation Authority’s approach to regulation is outcomes-focused and risk based.
They are responsible for the following:
- The SRA Handbook. This covers all aspects of regulation and was updated on 1st October 2018 to Version 20. There are ten Principles which are compulsory and deal with ethics and professional standards which apply to everyone involved with law firms, including non-lawyer owners and individuals.
- The SRA Code of Conduct. The SRA Handbook contains a Code of Conduct explaining in detail the relationship between the solicitor and his client as well as the appropriate way to manage and supervise their firm. This is very much outcomes-focused driven and aims for a positive beneficial outcome tailored to your firm and clients. Solicitors have always held a position of trust and are required to act in an ethical way and for the benefit of their clients. The SRA Code of Conduct provides guidance to solicitors on how to deal with these obligations by outlining 10 compulsory principles. The overriding principles are acting in the public interest and upholding justice.
- The SRA Accounts Rules. Version 20 of the SRA Handbook was introduced on 1st October 2018. The SRA Accounts Rules are contained in the SRA Handbook and affect solicitors who operate a client account, providing guidance on how to handle clients’ money. The SRA rules and regulations governing solicitors accounts used to be substantial and very detailed, but the SRA have chosen to reduce these dramatically. It will therefore be extremely important for solicitors and other legal practitioners to ensure that they employ experienced legal cashiers and bookkeepers who are able to interpret the new rules with the benefit of hindsight. More information about the changes can be viewed in our article “From a book to a pamphlet. SRA Accounts Rules 2018 & what is client money?”
- Issuing practicing certificates – To enable a solicitor to act for clients, he must hold a current practising certificate which is issued annually.
- Training and admissions. The SRA are also involved in training (CPD) which must be completed by solicitors annually to ensure they are up to date with changes in the law. They also handle the admissions both of individuals who want to become solicitors and those wishing to be granted higher rights to represent their clients in court as advocates.
- Guidance on confidentiality, outsourcing functions and compliance matters. The SRA have their own ethics department who are able to assist with matters of conflict between existing clients and other difficult questions. They can also provide advice on whether elements of the solicitors’ practice can be outsourced to third parties and at the heart of all they do, advise on matters of compliance.
- Solicitors Disciplinary Tribunal. Through the SDT, the SRA are also responsible for discipline of solicitors who do not comply with the rules or act in a way which brings the profession into disrepute. This can in some cases lead to a solicitor being struck off the roll, fined or suspended from practice. There are a significant number of situations where solicitors appear before the SDT because of bookkeeping failures. It is therefore extremely important that you employ experienced legal cashiers like The Law Factory LLP who have years of experience of dealing with the SRA.
- Intervention in practices which are suspected of mismanagement, negligence or dishonesty. There are many cases each year where firms are intervened. This may be because clients have complained about the way their cases have been handled, because of qualified reports from the firm’s accountants showing issues with the way the accounts are being run or because there is evidence of dishonesty. The Law Factory have been asked to assist many firms where the Solicitors Regulation Authority come in to investigate potential issues and have been successful if putting right issues caused by previous bookkeepers and avoiding the possible shut down of the practice.
- Cost recovery and payment of compensation. The SRA also arrange for costs to be recovered and compensation paid in situations where a solicitor or firm generally have fallen below the standard required of them, resulting in a detrimental effect on their clients.
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