Have you complied with your trust accounting obligations?

Legal practice directors of incorporated legal practices (ILPs) are required to ensure they have appropriate management systems in place, but the QLS Ethics and Practice Centre recommends all practices (whether ILP, sole trader or partnership) have appropriate management systems in place.1

There are 10 areas identified in which appropriate management systems ought to be implemented in order to comply with the Legal Profession Act 2007 (Qld). Complying with trust accounting regulations and maintaining proper accounting procedures is one of the 10 areas.

Money entrusted to a law practice in the course of, or in connection with, the provision of legal services is trust money. This may include money received for legal costs in advance of the services being provided; transit money; controlled money and money received by the practice that is subject to a power (exercisable by the practice or an associate of the practice), to deal with the money for another person.

We each have an obligation to ensure trust money is held in a way that protects the interests of persons for whom money is held.2

This April we will be highlighting resources to help you ensure you have appropriate management systems in your office in respect of your trust accounting procedures. Keep a lookout on our QLS Solicitor Support LinkedIn Group, Facebook and Instagram for more posts.

We will look at or provide access to resources on the following matters:

  • What is trust money?
  • Has your practice been authorised by QLS to effect electronic conveyancing settlements via an e-settlement platform?
  • The importance of verifying the identity of persons for whom you will hold trust money.
  • What do I do if there is a deficiency in a trust account?
  • What is power money?
  • Why do I need a written direction of moneys?
  • What do I do about unclaimed monies?
  • Receiving credit card payments into trust.
  • Electronic signing of trust account authorities.
  • Revisiting cyber claims and warnings that you might like to incorporate in your practice.

Importantly, are all of your staff trained on your office’s trust account procedures? What systems do you have in place if an error is made or detected?

The Practice Advisory Service is a complimentary service for sole/micro practices across Queensland. For more information or to book a practice visit, contact the QLS Ethics and Practice Centre on 07 3842 5843 or email ethics@qls.com.au.

The Trust Account Consultancy is another complimentary service available for newly established practices across Queensland to assist them in complying with their trust accounting obligations. For more information or to request a practice visit, contact email managertai@qls.com.au or phone 07 3842 5908.

Footnotes
1 Legal Profession Act 2007 (Qld), s117(3).
2 Legal Profession Act 2007 (Qld), s236(a).

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