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Proposed New Accounts Rules for Licensed Conveyancers

The Council for Licensed Conveyancers (“CLC”) has issued a consultation, which runs until 21 June 2019, as to how their Accounts Code can be amended.  The Summary within the consultation document highlights the following:

“Whilst ensuring that appropriate levels of consumer protection are maintained, the CLC’s objective in reviewing the Accounts Code is to:

  • Remove any unnecessary and disproportionate regulatory burden;
  • Provide greater flexibility for CLC Lawyers and Practices to participate in a diverse legal market, increasing access for the public and quality of legal services;
  • Provide greater clarity for CLC Lawyers and Practices so that the CLC’s expectations are easily understood;
  • Future-proof the Code as much as possible; and
  • Maintain appropriate consumer protection."

The CLC proposes to:

  • Simplify the Accounts Code by removing any unnecessary barriers and restrictions to ensure that the Code is appropriate and proportionate;
  • Amend the format of the Accountants Report to allow greater freedom for Reporting Accountants to determine the tests which are appropriate for any specific practice on its business model and risk profile;
  • Reduce the time for submitting the Accountants Report to the CLC from 6 to 3 months;
  • Introduce a new self-certification scheme for aged balances of up to £50;
  • Enable CLC Practices to send aged balances of up to £10 to a nominated charity;
  • Make provision for the use of Third Party Managed Accounts (TPMAs); and
  • Revise the Accounts guidance to be more targeted and focused.

The aim is that the review of the Accounts Code will be completed in July 2019 with any changes coming into force in January 2020.

It is proposed that the revised Accounts Code will extend to just eight rules across five pages, and subject to the outcome of the consultation, and approval by the Legal Services Board, it is proposed that they will be issued in their final format in September 2019.

HAT's SRA Accounts Rules Manual currently provides guidance on how to complete a CLC Client Money assignment and this will be updated to reflect these new requirements when they become effective.