24 finance


Protecting client money – what next for the SRA accounts rules?


2014 was a year which threatened much change for the Solicitors Regulation Authority (SRA) accounts rules, but ultimately had very little impact for the vast majority of law firms. The question that is undoubtedly on every COFA‘s lips (or not) is what does the SRA next have in store for the accounts rules? asks Adam Wilson of Wilkins Kennedy


The SRA is reviewing the operation of the accounts rules as part of its wider programme of regulatory reform, which they say is “designed to ensure that regulation is proportionate and targeted, with the aim of reducing unnecessary regulatory burdens, while providing appropriate levels of consumer protection“.


In the summer of 2014 following a process of consultation, the SRA confirmed that the proposal for firms to no longer deliver accountants reports was to be abandoned, pending a more thorough review of the rules themselves. The main changes implemented were that only qualified reports would be required to be submitted with the SRA, and that firms that received 100% of their fees from legal aid work were to be


law south east Eric Robinson Solicitors welcomes ‘Eric‘


While The Business Magazine always covers the latest corporate appointments, it is unusual when a law firm tells us about the employment of a wide-eyed, bright blue owl. Catherine Maxfield, managing partner of Eric Robinson Solicitors, tells us about the Hampshire law firm‘s latest recruit


Have you met Eric the Owl? If not, then you certainly will as this character is set to become the hardest-working bird across the South Coast. Originally introduced to the public as part of Eric Robinson Solicitors‘ 50th anniversary celebrations last year, Eric proved such a hit with the public, he has now become a full- time employee.


“It all started in 2013 when we were looking for something fun and cute to send to clients and give out at events,“ explains Maxfield. “We saw some hand- sized, owl-shaped foam models that we could have in gold for our Golden Anniversary and, since the owl has always been a sign of wisdom and knowledge, we


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thought it was a good fit for a law firm. We had absolutely no idea of the public reaction that would follow.


“We had people asking us how much they were, parents wanting them for their children and babies giggling with excitement when handed them. We were initially surprised, but absolutely delighted as this ‘ice-breaker‘ led to an astonishing amount of worthwhile conversation.“


Over the summer, the firm ran a competition where people were asked to take Eric on holiday and take pictures at various locations. The firm received pictures of Eric on beaches across Europe and America, in front of historic


monuments in cities including Rome and Vancouver and enjoying afternoon tea in Somerset. The winner sent in a picture of Eric with a train driver of the oldest train in Norway.


“Eric gained incredible momentum over the year, so now he has evolved into a full-time ambassador for the firm,“ says Maxfield. “He has his own website: www.erictheowl.co.uk where people can download ‘Eric‘s Top Tips‘ on a whole range of legal issues.


“Of course, we want Eric to be a source of fun, but in all seriousness, he is proving a great business asset to the firm. For our private clients, especially, it is about providing character, approachability and trying to aid people‘s understanding of what we offer in a fresh, original and recognisable way.


“Having said that, many of our corporate clients talk about and say how much they enjoy Eric. No matter what service you are using, whether you are at work or home, everyone enjoys a smile.“


Details:


023-8022-6891 enquiries@ericrobinson.co.uk www.ericrobinson.co.uk


exempt from needing to commission a report in the future.


The SRA also announced a phased approach to looking at the operation of the accounts rules going forward. Having implemented Phase One in October 2014, the next phase would start in April 2015.


The latest consultation, which closed in January, included a significantly reduced format of accountants report and effectively proposed the removal of the prescribed testing procedures required to be undertaken by the reporting accountant, with the onus being on the accountancy firm to utilise its professional judgement in determining which tests needed to be completed. As part of the


proposed new format of the report, the reporting accountant is required to comment on whether they did, or did not, identify deficiencies in the firm‘s systems, and then outline the nature of those deficiencies.


As part of its response to the consultation, Wilkins Kennedy flagged this lack of guidance and use of professional judgement as being a potential risk area, not only in terms of the potential for inconsistency in reporting by different reporting accountants but also with regards to assistance for compliance officers in determining control issues in their systems and what breaches were reportable to the SRA.


In February, The Law Society also echoed this view, particularly


flagging up that “accountants would need guidance on what might qualify as a serious deficiency“.


The ongoing drive by the SRA to ensure that firms are not having to meet an excessive regulatory burden should be maintained, and therefore the proposed phased approach to reviewing the existing accounts rules, including exploring the removal of certain rules should assist in meeting that objective.


If the SRA, with the help of the legal firms themselves, and other key stakeholders, is able to streamline the rules further, while maintaining the focus on the key areas in terms of protection of client money and fraud, then clearly this will be a pleasing outcome for all involved.


Details: Adam Wilson 023-8024-7070 adam.wilson@wilkinskennedy.com www.wilkinskennedy.com


THE BUSINESS MAGAZINE – SOLENT & SOUTH CENTRAL – MARCH 2015


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