How often must a licensed conveyancer reconcile the client account?
Every calendar month under the CLC Accounts Code. Prepared to a date no more than five weeks after the last reconciliation, and completed within seven days of that date. The client bank balance, the client cash account and the total of the client ledger balances all have to agree, and the reconciliation has to be reviewed and signed off: by the Head of Finance and Administration in an ABS, or by an authorised person in other practices.
What the Code asks for
Three things, in order. A bank reconciliation statement comparing the client cash account balance with the client bank statements and passbooks. A listing of every client and office ledger balance, with the total of the client ledger credit balances compared to that reconciliation. And a statement explaining the cause of any difference the comparison throws up.
The third one is the one firms skip. A difference without an explanation is not a reconciliation — it is a note that something is wrong.
The timing, precisely
Monthly, to a date no more than five weeks after the date the last one was prepared to, and finished within seven days of that date. So a reconciliation prepared to the end of March has to be completed by the seventh of April.
Monthly is the floor. The Code explicitly supports reconciling weekly or daily, and in conveyancing where completion money arrives and leaves in the same week, more frequent reconciliation is how you find a misposted receipt before it becomes a shortfall.
Who signs it off
In an ABS, the Head of Finance and Administration. In other practices, an authorised person. The point of the sign-off is independence: the person who does the posting should not be the only person who looks at the result.
Reconciling items have to be reviewed and cleared on a timely basis, and if a shortfall shows up it has to be made good without delay not at the next month end.
How this differs from the SRA Accounts Rules
An SRA-regulated firm reconciles at least every five weeks and the sign-off sits with the COFA or a manager. The CLC is more prescriptive: every calendar month, a maximum of five weeks between reconciliation dates, and a seven-day window to complete it.
If your firm does conveyancing under SRA regulation, the SRA Accounts Rules are the ones that apply to you. The CLC Accounts Code only binds CLC-regulated practices.
Related questions
Legal Cashiering for CLC-regulated firms
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