TAMOR Trust Accounting

A complete guide to receiving, holding, and disbursing trust money including record keeping requirements. Click through the sections below to access the information on the area which is relevant to your concerns.

The Law Society advises accessing these resources directly on our website instead of printing or downloading them. As soon as content is printed, it is deemed out of date. This ensures you always have the latest updates from the Ethics and Practice Law Practice Compliance Investigators, who frequently revise sections to reflect changes in practice, approach, and legislation.

Trust Account Compromise

Discover essential steps to take immediately after a trust account compromise. Learn about effective preventative measures and how to support staff through the recovery process.

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Trust Money Definition and Legislation

The provisions of the South Australian Legal Practitioners Act 1981 (the Act) and Legal Practitioners Regulations 2014 (the Regulations) relating to trust money and trust accounts standardise the records required to be kept by practitioners.

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Receiving Trust Money

A law practice receives money when it gains possession or control directly, indirectly or through an associate. There are various ways in which trust money can be received, affecting clearance times, and each carrying risk.

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Receipting Trust Money

Discover the essential information a law practice must capture when preparing a trust receipt for all trust money received that is to be paid into a general trust bank account.

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Deposits

A law practice that receives trust money for deposit to the general trust bank account, must deposit the funds without delay and retain proper records of the deposit.

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Cashbooks

Law practices must maintain a trust account cash receipts book and a cash payment book. A combined book is acceptable if transactions are recorded in order and comply with the regulations. All law practice trust receipts and payments must be recorded in the cashbooks.

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Trust Ledgers

The individual trust ledger account is a key accounting document that contains all transactions (receipts, payments, and transfer journal entries) relating to the one client matter and provides a detailed financial history of that matter.

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Payments

Paying money from the general trust bank account carries inherent risk and requires care and attention at every step. Proper authorisation, checks, balances, and controls can help reduce numerous risks. Complete records are essential to verify client instructions have been effected.

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Reconciliations

Reconciling the trust bank account is a critical control which should highlight all errors or omissions made while recording any information in any of the books of account or made in the trust bank account during the preceding month. This time sensitive process is key to ongoing compliance.

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Trust Account Statements

A law practice is required to furnish a Trust Account Statement to each person for whom trust money is held, including power money, controlled money, investments, and funds in the general trust bank account.

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Legal Practitioners Combined Trust Account

Law practices are required to conduct a CTA calculation twice in each year to determine whether a deposit is required to be made to the CTA. Failure to meet this key requirement may result in interest liabilities.

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Journal Transfers and Transit Money

A law practice can internally transfer funds from one matter to another and deliver third party cheques to the payee when key requirements are met including proper authorisation and record keeping.

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Investments

A law practice can invest funds for a client if lawfully directed to do so. Knowing limitations and avoiding unnecessary risks is critical for the law practice and to protect trust money.

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Controlled Money

Controlled money is trust money a law practice must deposit into a specific account as directed by a client in writing, with exclusive control, distinct from a general trust bank account.

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Power Money

Legal practitioners who are executors, attorney’s, trustees, or guardians other than in a private and personal capacity, have specific requirements to ensure proper trust records are maintained of all financial dealings.

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Need advice on a specific practice scenario?

Seek assistance early from Ethics and Practice: Trust Accounting Regulation and Support on (08) 8229 0229 or via [email protected].

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