Solicitor LLP

peaman

I have been approached by a solicitor LLP who would like me to prepare their partnership accounts & tax return.

I would not need to prepare any of the reports for SAR as these are prepared by another accountant.

I have been preparing sole trader, partnership & ltd company accounts for 18yrs, but I have never prepared accounts for a solicitor before, or have I prepared LLP accounts. However, they have sent me a copy of last years accounts and tax return and it all looks pretty straighforward.

I have been advised by an ACCA accountant that solicitors accounts have to be submitted by an ACCA accountant and registered auditor.

Does anyone know if this is true, I have read conflicting views on this.

Steve Collings

Precise Tax wrote: »

I have been advised by an ACCA accountant that solicitors accounts have to be submitted by an ACCA accountant and registered auditor.

Does anyone know if this is true, I have read conflicting views on this.

The Solicitors Accountants Report and associated Checklist can only be compiled and signed off by a CCAB accountant (ACCA/ICAEW etc). Rule 34.1 of the SARs 2011 which took effect from 6/10/11 (Rule 37 in the SARs 1998 - still in effect for periods prior to 6/10/11) also requires the report to be signed by a registered auditor.

The accounts themselves do not have to prepared specifically by an ACCA accountant/registered auditor. Many people do often get confused between the accounts themselves and the Solicitors Accountants Report (the accounts are the accounts, the Accountants Report submitted to the SRA relates to the client money audit).

Kind regards
Steve

peaman

Many thanks Steve

Presumably I just need to prepare the partnership accounts and tax return, together with the individual partners return as usual. Then, I will need to forward the accounts to the accountant that prepares the SAR report to enable them to extract the information needed to submit the reports, would this be correct?

Steve Collings

I wouldn't be too concerned if I were you about the reporting accountants because their work is a completely different (and separate) exercise to the accounts preparation. Where I act for solicitor clients that have a separate accountant to do the work, I generally ask for a copy of the accounts for planning purposes, but in all honesty I very rarely refer to the accounts themselves.

It is important to keep in mind that the work of a reporting accountant who is compiling the accountants report for submission to the SRA is NOT undertaking an audit of the accounts in any way, shape or form. They are not expressing an opinion on the truth and fairness of the accounts, nor are reporting accountants expected to perform any tests such as tests of control on solicitor client's internal control systems (though reporting accountants are duty bound to report any "substantial departures" from the guidelines in the rules on accounting/record keeping that they may discover). It is important that solicitor clients are aware that the work of the reporting accountant is to ensure that client money and client accounts are properly accounted for in accordance with the accounts rules - it is not audit in the traditional sense of the word, thus the reporting accountant will not use the financial statements of the practice as the basis for his/her work.

Regards
Steve

peaman

Many thanks Steve

Much appreciated

Richard

jamesm96

Steve Collings wrote: »

The Solicitors Accountants Report and associated Checklist can only be compiled and signed off by a CCAB accountant (ACCA/ICAEW etc). Rule 34.1 of the SARs 2011 which took effect from 6/10/11

If I may crash across this thread... Steve, does this prevent a member of the accounting firm who is not CCAB qualified from preparing the working papers in readiness for a CCAB qualified member to fill out and sign the report?

Steve Collings

Hi Mike
No, many firms send staff to do the detailed work. The reporting accountant will then review this work and decide on the opinion. In this respect it's much the same as an audit - audit staff will do the detailed fieldwork, and the partner will review the evidence, form an opinion and then sign the auditor's report.

Regards
Steve

jamesm96

Steve Collings wrote: »

Hi Mike
No, many firms send staff to do the detailed work. The reporting accountant will then review this work and decide on the opinion. In this respect it's much the same as an audit - audit staff will do the detailed fieldwork, and the partner will review the evidence, form an opinion and then sign the auditor's report.

Regards
Steve

Goodo, that's what I thought. Just the way I read your comment struck me that we may not be doing our SAR audits properly!

Gem7321

Precise Tax wrote: »

I have been preparing sole trader, partnership & ltd company accounts for 18yrs, but I have never prepared accounts for a solicitor before, or have I prepared LLP accounts.

So are you licensed to complete this work?

peaman

I am licensed with the AAT to prepare accounts and tax returns etc. There are no specific licensing requirements (fom the AAT) for preparing either solicitors or LLP accounts.

As I am not preparing any reports for the SRA, there are no licensing requirements there!

I have now met the client and seen the latest accounts (on Osprey software!), and it is all straightforward. :001_smile:

Gem7321

Apologies, I thought I recalled having to specify how many clients were sole traders, partnerships etc. which I thought was part of the application to be considered. I didn't realise you could apply to do work for different types of client with no experience in that particular area.

peaman

Yes, as part of the annual membership renewal you enter in boxes the number of sole trader, ltd company etc. clients that you currently have. Is is just a snapshot of the clients at that date. Clients that are picked up throughout the following year will be included when completing next years renewal process.

I am not taking on a client that I have no experience. I have prepared thousands of accounts for sole traders, partnerships and ltd companies over the last 18 yrs.

Accounts for solicitors are just the same as for everyone else, apart from the client money account, which I am having nothing to do with, as it is dealt with the firm preparing the SRA reports.

LLP accounts are the same as normal partnerships, with a slightly different members/current account and some companies house filing. All simple.

It is just another client, you need to get acquainted with the different expenses etc. as you would with any new client.

I haven't prepared accounts for a lion tamer before, but if a lion tamer approached me and asked me to prepare his accounts, I would take him on (so to speak!). Unless his accounts needed an audit (unlikely).

Barry

I don't agree that LLP accounts are the same as partnership accounts with the exception of Co Ho filing and capital/current accounts. I do accounts for LLP's at work and they are much different in terms of layout in that they look a bit like a Ltd co set of accounts and the members capital accounts etc are referred to as Members interests plus there is a members report in ours.

Not sure if solicitors have their own accounting layout but a bog standard partnership accounts look much different than a LLP in my opinion.

peaman

Yes, I agree. The accounts look just like ltd. accounts, apart from the members interests & report. But, essentially it is just a partnership set of accounts with members interests instead of current/capital accounts and in a different format.

I am not concerned about the wording on the accounts & format etc. as the software will take care of that. And I have last years accounts as a guide.

I was just making the point that a person with loads of experience preparing partnership & ltd accounts would have the necessary experience to prepare LLP accounts, as it was implied that I had no experience in the area. 95% of the work I will have plenty of experience and 5% will be new.

Does anyone know of a lion tamer that needs his accounts prepared? I am quite taken with the idea now. As long as he doesn't mistreat the lion.