Q. I am a partner in a firm with two offices and I arrange for the accountant's report to be delivered to the office in which I am located. The other office is managed by one of the other partners of the firm, who normally makes the arrangements for the report to be delivered. If the other partner fails to deliver the accountant's report will it affect me?

A. Yes. If a firm has more than one office, separate accountant's reports may be delivered (see rule 48 of the Solicitors Accounts Rules 1998), so long as every office is covered by a report delivered within six months of the end of its accounting period. Where client money is held or received by a practice, all the principals in the practice (including those held out as principals) will have held or received client money. Therefore, you will have held client money in relation to that office, even if you were not physically based there. Consequently, you are required to deliver an accountant's report for that office as well as all the other offices of the firm. If the accountant's report is not delivered, you will be in breach of the rules and the Solicitors Act 1974.




Q. I am a salaried partner. Do I have to deliver an accountant's report?


A. When client money is held or received by a practice, all the principals in the practice (including those held out as principals) will have held or received client money. A salaried partner whose name is included in the list of partners on a firm's letterhead, even if the name appears under a separate heading of 'salaried partners' or 'associate partners', has been held out as a principal. Therefore, you will have the same obligations as the other partners and, if no accountant's report is delivered, will be in breach.


Question of ethics is compiled by the Law Society's professional ethics guidance team. Send questions for publication to Austin O'Malley, the Law Society, Ipsley Court, Berrington Close, Redditch B98 0TD; DX 19114 Redditch