SRA Accounts Rules 2026 - Virtual Conference

Introduction

The SRA Accounts Rules sit at the heart of law firm compliance, yet they remain a source of significant risk, uncertainty and regulatory scrutiny for many practices. This virtual conference brings together leading experts to examine the rules in depth, exploring the practical challenges that firms face in day-to-day compliance and the wider consequences of getting things wrong.

From client money management and disbursement treatment to merger due diligence and regulatory investigations, this conference is designed to give in-house counsel and lawyers in private practice the technical insight and practical tools they need to protect their firms and their clients. The conference will be chaired by Tracey Calvert, one of the UK's foremost authorities on SRA compliance.

Conference Agenda

10am-11am: How to Prevent your Law Firm Acting as a Bank

Tracey Calvert, Director, Oakalls Consultancy Limited

The SRA Accounts Rules contain a prohibition on providing banking services.

This is an absolute restriction and it is a key risk management topic that all members of the law firm understand the issues and the risks attached to providing banking services to clients and third parties.

Learning Outcomes:

• Understand the reason for the prohibition
• Identify banking traps
• Understand how the risk can be effectively managed

Morning Break

11:10am-12:10pm: Law Firm M&A: Understand and Mitigate Client Account Risks

Susanna Heley, Legal Director, Russell Cooke

Since the 20 partner rule for law firms was abolished, the dominant market trend has been towards consolidation and increasingly large firms. While so called ‘consolidator’ firms are seen as fraught with problems in light of the Axiom Ince scandal, SSB debacle and recent failure of PM Law leading to estimated minimum client account losses of well over £100m, many others have thrived and even expanded nationally or globally following merger. This session explores the crucial due diligence questions firms should be asking of potential merger partners concerning management of client money, the major pitfalls and liabilities which can arise and how to navigate risks arising from client accounts.

Learning Outcomes:

• Recognise key risks related to the use of client accounts, including common risk indicators such as residual balances, round sum transfers, intra-ledger transfers, escrow arrangements and interest payments
• Understand key due diligence actions necessary to ensure appropriate management and transfer of risk during the merger process
• Identify strategies to protect your firm and your managers from exposure to regulatory and financial risk arising on merger of firms’ client accounts

12:10pm-1:10pm: Rules 12 & 13: How SRA Does or Does Not Regulate the Profession Via Accountants’ Reports

Geoffrey Williams KC, Barrister, Farrar’s Building

Rules 12 and 13 of the SRA Accounts Rules continue to raise fundamental questions for the profession. This session takes a critical look at how the SRA's approach to accounts-based regulation has shifted over time, examining what has been gained and lost along the way. Drawing on extensive experience of SRA investigations, this session provides a frank and practical analysis of how accountants' reports are used as a regulatory tool and what this means for firms facing scrutiny today.

Learning Outcomes:

• Understand the scope and operation of Rules 12 and 13 within the SRA Accounts Rules framework and how the SRA's regulatory approach has evolved over time
• Identify the key risk areas and warning signs that may indicate heightened regulatory scrutiny in accounts-based SRA investigations
• Apply a confident and structured approach when faced with an SRA accounts-based investigation, including understanding the proper procedural and evidential steps involved

Break for lunch

2-3pm: The Disbursement Dilemma: VAT, Billing & Regulatory Risk in Legal Practice

Darren Whelan, Founder & Owner, Association of Legal Compliance & Accounts

Disbursements remain one of the most misunderstood and inconsistently applied areas within legal finance and compliance.

For years, legal practices have wrestled with inconsistent treatment, conflicting opinions and outdated assumptions.

This practical and engaging session explores the regulatory, billing and VAT risks that arise when firms incorrectly classify client-related costs.

Drawing upon HMRC guidance, case law, SRA Accounts Rules and real-world examples from legal practice, the session will examine how firms should approach common expense types including counsel fees, expert reports, medical records, travel costs, bank charges, probate fees and search fees.

The session will also address the often-overlooked compliance consequences of getting it wrong, including residual balances, client money issues, improper billing, VAT exposure, audit concerns and regulatory scrutiny.

By the end of this session delegates will be able to:

• Distinguish between disbursements and recharges using practical legal-sector examples
• Understand the regulatory and Accounts Rules implications of incurred and anticipated disbursements, including client money and billing considerations
• Identify common VAT and compliance risks arising from incorrect treatment of recharges and disbursements
• Apply a practical decision-making framework to assess whether a cost qualifies for the disbursement treatment

Afternoon break

3:15-4:15pm: Rule 2.5 in Practice: Residual Balances, Risk Exposure and the Hidden Knock On Effects

Joanna Morris

Rule 2.5 of the SRA Accounts Rules requires firms to return client money promptly once there is no longer a proper reason to retain those funds. Where this does not occur, the monies become residual balances and the firm is, by definition, in breach.

Although the requirement appears straightforward, many firms continue to accumulate new residual balances whilst also struggling to clear long standing ones. The consequences extend beyond technical non compliance: unnecessary funds remain in the client account, interest calculations become distorted, file closures are delayed, and the firm may attract unwelcome regulatory attention.

Joanna will provide practical guidance, highlight common pitfalls and offer up to date insights to support firms in maintaining compliance as the regulatory landscape evolves towards 2026.

In this session we will look at the following:

• The requirements of Rule 2.5, including how the term ‘promptly’ should be interpreted and applied within their own firm
• The common reasons why client monies remain unreturned and how residual balances arise in practice
• The practical measures and internal controls that can be implemented to prevent residual balances from occurring
• The wider operational, financial and regulatory consequences for the firm when residual balances are not addressed appropriately

Recording of live sessions: Soon after the Learn Live session has taken place you will be able to go back and access the recording - should you wish to revisit the material discussed.