Compliance and risk assurance services for solicitors

From 1 January 2013, the outcomes-focused regulation (OFR) regime is likely to involve initial and ongoing resource commitments for solicitors’ firms, which include appointing new compliance officers for finance and administration (COFA) and legal practice (COLP).

The COFA has the key responsibilities of ensuring all reasonable steps are taken to ensure the  firm and its employees comply with the Solicitors Regulation Authority’s (SRA) Accounts Rules and recording and reporting any non-compliance to the SRA

COFAs will need to be sufficiently senior to gain cross-practice co-operation in implementing change and comprehensive access to financial information to ensure compliance.

But the diversion of a fee earner to compliance issues could have a potentially significant impact on a practice, particular in smaller firms where the COFA is more likely to be a partner, member or director.

While the COFA, like the COLP, cannot be an external appointment, outsourcing COFA-related tasks is a common-sense solution to ensuring key responsibilities are taken care of, while the COFA concentrates on oversight of the overall compliance function.

At HB&O, our work with solicitors’ firms means we are experienced in the financial management issues of practices and have the detailed knowledge of the SRA Accounts Rules crucial to fulfilling the responsibilities of the COFA.

With our in-house risk assurance expertise, we can also support COFAs in identifying, monitoring and managing risk within their firms.

Our COFA services include

  • assessing accounting systems and controls to ensure fitness for purpose
  • monitoring and regularly reviewing accounting systems and controls to ensure that they are working effectively
  • providing training – induction and ongoing – for current and future members of the practice team in the SRA Accounts Rules, to support the role of all individuals in practice compliance, including specific training, e.g. for fee earners
  • regularly reviewing and analysing fee earners’ active files from a financial perspective to identify any trends that require action and any breaches
  • regularly reviewing client and office ledger balances
  • bank account reconciliations
  • reviewing risk management procedures and advising on opportunities to enhance firm-specific controls to minimise risk, e.g. of fraud and to safeguard assets
  • documenting all financial, control and risk management systems, as a valuable reference tool for the firm and its employees.

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