In Scotland, client account reconciliation is a key regulatory requirement for solicitors and an essential part of running a compliant and well-managed law firm. Firms must ensure that all client funds are correctly recorded and reconciled in accordance with the Law Society of Scotland’s Accounts Rules. 

Failing to comply can lead to serious consequences but what exactly is required when it comes to reconciling your client accounts? 

 

What Is a Client Account Reconciliation? 

A client account reconciliation is the process of comparing the balances shown on your firm’s client bank account, cashbook, and client ledger to ensure that they match and that all transactions are accounted for accurately. 

Regular reconciliations are vital to ensure client funds are safeguarded and properly managed and is a mandatory part of complying with the Law Society of Scotland’s Accounts Rules. 

 

What Do the Law Society of Scotland Rules Require? 

The Solicitors (Scotland) Accounts Rules set out clear expectations for the management of client money. When it comes to reconciliations, firms must prepare a full reconciliation of client bank accounts at least once every five weeks, as well as ensuring it includes: 

• The cashbook balance 

• The total of the client ledger balances 

• The balance on the client bank account 

• Document who completed and reviewed the reconciliation 

• Retain all reconciliation records for at least 10 years 

• Be able to produce reconciliation records on demand during a routine inspection or investigation 

Why Regular Reconciliation Matters 

Regular reconciliations are essential not just for compliance, but for good practice. They help law firms: 

• Prevent and detect errors, fraud, or mis-postings 

• Maintain client trust and professional standards 

• Be fully prepared for Law Society inspections 

• Improve cash flow visibility and financial oversight 

Firms that fall behind on reconciliations or rely on outdated manual processes increase their risk, both financially and reputationally. 

 

Common Challenges for Scottish Firms 

Many Scottish firms, especially smaller or high-volume practices, tell us they struggle with: 

• Managing multiple client ledgers 

• Staying up to date with regulatory changes 

• Lack of in-house cashiering resource or expertise 

• Balancing reconciliations with a busy caseload 

At Cashroom, we specialise in helping law firms stay on top of these tasks, ensuring full compliance with Law Society of Scotland Account Rules. 

How Cashroom Supports Scottish Firms 

We understand the rules and regulations and work with law firms across Scotland to provide fully outsourced legal cashiering and compliance support, including: 

• Timely, accurate client account reconciliations 

• Full compliance with the Law Society of Scotland Accounts Rules 

• Qualified legal finance experts handling all reconciliations 

• Seamless integration with Denovo, LawWare and ALB 

• Real-time oversight and access to reporting via our secure portal 

Whether you’re looking to reduce risk, save time, or simply get peace of mind, we’re here to help. 

 

If you’re a law firm handling client funds, regular reconciliations aren’t just good practice, they’re essential for compliance. With expert support from Cashroom, you can make sure your reconciliations are accurate, timely, and fully compliant with the Law Society’s expectations. 

Need help with your reconciliations or wider cashiering function? 

Get in touch with Cashroom today to find out how our expert team can support your firm.