Solicitors Regulation Authority to introduce new accounts rules
The Solicitors Regulation Authority (SRA) has confirmed new regulations, which include simpler accounting rules for client monies under the SRA Accounts Rules, due to come into effect on 25 November 2019
21 Mar 2019
The regulator said the shorter, more targeted standards and regulations will remove many prescriptive rules. This will reduce the burden on solicitors and law firms, and allow solicitors greater freedom to use their professional judgment in considering how they meet the standards.
This follows a first consultation on the issue in 2016, which outlined plans to simplify the SRA Accounts Rules 2011.
Key changes being introduced include simpler account rules that focus on the principles of keeping client money safe, rather than lots of specific technical rules; creating separate codes of conduct for firms and solicitors; freeing up solicitors to carry out ‘non-reserved’ legal work from within a business not regulated by a legal services regulator; and allowing solicitors to provide reserved legal services on a freelance basis.
November will also see the SRA digital badge becoming a mandatory requirement for all regulated firms who run a website. First launched on a voluntary basis in December 2018, the badge uses smart technology to confirm to website visitors that a specific firm is regulated. It also provides a firm-specific link to information on the protections that this status provides to potential customers.
Anna Bradley, chair of the SRA board, said: ‘By stripping away outdated and unnecessary rules and giving solicitors more flexibility to design and deliver their services around their clients, our new regulations are designed to help people access a wide range of high quality services with the confidence that proper protections are in place.’
The reforms were approved by the Legal Services Board (LSB) last year, following a four-year period of development and consultation.
The SRA says it will publish a range of guidance over the coming months. Initial documents will cover areas such as the accounts rules, practical application of the SRA principles and which type of firms and individuals need authorising.
Ross Prince, partner, professional practices, Crowe UK, said: ‘Despite the significant rewrite, for most firms there should be few significant changes to implement. That being said, the new regulations will create space for firms to take a more autonomous role in the way they work and do business.
‘The November implementation date gives firms some time to look at their systems and policies and think about how they might want to change. We await the release of the toolkits and guidance from the SRA as these should aid firms as they do this.’
Report by Pat Sweet
SRA Standards and Regulations updated 20 March 2019, list of regulatory updates and status