Solicitor Trust Account Audit – Annual Compliance

What is a Solicitor Trust Account Audit?

A solicitor trust account audit is a mandatory annual examination of the trust accounts maintained by law practices across Australia. Legal practitioners are required to hold client funds in designated trust accounts, and these accounts must be independently audited annually to ensure compliance with the Legal Profession Uniform Law and relevant state regulations.

The audit provides assurance that client funds are properly safeguarded, accurately recorded, and only disbursed for authorised purposes. This protects both clients and the legal profession's reputation.

Regulatory Requirements by State

Each state's Law Society or Legal Services Board sets specific requirements:

• NSW & Victoria: Governed by Legal Profession Uniform Law. Annual external examination by approved examiner required.
• Queensland: Queensland Law Society requires annual trust account audit under Legal Profession Act 2007.
• South Australia: Law Society of South Australia mandates annual trust account audits.
• Western Australia: Legal Practice Board requires annual trust account reports.

What Auditors Examine

A solicitor trust account audit covers comprehensive areas:

• Monthly trust account reconciliations are performed and accurate
• All trust receipts are deposited within required timeframes (usually same or next business day)
• Trust money is only withdrawn for authorised purposes with proper documentation
• Client ledgers accurately reflect all transactions
• Interest on trust accounts is properly handled per regulations
• Adequate internal controls exist to prevent misappropriation
• Record retention requirements are met
• Trust account deficiencies are promptly rectified

Audit Costs for Law Firms

Solicitor trust account audit fees vary based on practice size and transaction volume. Sole practitioners and small firms typically pay $1,200 to $3,000 annually, while larger firms with higher transaction volumes and multiple trust accounts may pay $3,000 to $8,000 or more.

Factors affecting price include the number of active client matters, volume of trust transactions, quality of record-keeping systems, and whether any compliance issues from prior years need attention.

Consequences of Non-Compliance

Trust account compliance is taken very seriously in the legal profession. Non-compliance can result in:

• Disciplinary action by the Law Society or Legal Services Board
• Suspension or cancellation of practising certificate
• Financial penalties
• Claims against the Fidelity Fund
• Professional indemnity insurance implications
• Reputational damage affecting client relationships

Get Your Trust Account Audit Quotes

Post your solicitor trust account audit job on AuditLink for just $39 inc GST. Receive 3-6 fixed-price quotes from auditors experienced with legal trust account requirements within 24-48 hours. Our 100% refund guarantee ensures you only pay if you receive quotes.