AUDIT OF ATTORNEYS’ TRUST ACCOUNTS AND INVESTMENT PRACTICES

The audit of trust accounts and investment practices is known as to fall within the definition of attest function and therefore is at the mercy of practice review. They however fall outside the definition of Public Interest Entities as dependant on the Practice Review Committee. The techniques the following should be seen as a broad format only. For comprehensive methods professionals are referred to the SAICA Guideline issued in June 2004, available on the SAICA website. Ahead of agreeing to this engagement, the auditor should assess his professional competence and independence. Understanding of Section 78 of the Attorneys Act No 53 of 1979 and the rules of the relevant Provincial Law Society are a pre-requisite. Issue a notice of engagement.

Appendix III of the guide consists of a specimen engagement letter. Obtain sufficient understanding of the carrying on business and document this. Record considerations of regulations and laws and fraud and mistake. Perform and document the chance assessment. Pay particular attention to completeness of receipts, validity of transfers and payments, trust shortages and debit balances.

Assess and document materiality in order to determine sample size. Document an understanding of the accounting systems and assess the internal controls. Prepare an audit programme. Bear in mind the minimum techniques according to the guide. Agree the opening balance owed to the Provincial Law Society. Verify interest received on trust accounts and Section 78(2a) investments. Section 78(2A) investments’ interest is due to the client. Consider the reasonableness of the interest rate. Verify bank or investment company charges paid. Agree payments designed to the Provincial Law Society.

  • Trading Technology
  • Other technology perform the same functions as IWBs
  • Maximum limit for an individual loan or overdraft
  • Distribute NRs5 million give to each Village Development Committee
  • High Returns (Super)

At yr end day and another date prior to the 12 months end: – Verify all bank or investment company reconciliations. Determine the validity of reconciling items. Obtain bank or investment company balance certificates for all those trust funds. Be sure trust funds are not less than trust creditors. Add any debit amounts in trust creditors when performing this check back.

Verify an example of trust creditor balances back to customer files. Seek out any trust lenders with debit balances and set up the validity thereof. Ensure an investment mandate is available from each customer. Ensure an effective audit trail is available for all transactions. Ensure your client is supplied with a schedule reflecting all information on the investment. Written representations from the lawyer Obtain.

Appendix IV of the guide includes a specimen representation letter. Issue a management letter in respect of the control weaknesses determined. Issue the mandatory are accountable to the Provincial Law Society. Appendix I of the guide contains a specimen statement. A year The report to the Provincial Law Society arrives once, year end within six months of the close of the financial, usually on 31 August. No extentions of the dates to lodge the report are granted.

If the report is not lodged timeously the practitioner may apply for condonation and in most instances will be asked to pay a disciplinary fine. The eye because of the Provincial Law Society must be paid by 31 May. The auditor has right of access to any records considered necessary to release his/her responsibility. If gain access to is denied it should be reported to the Provincial Law Society. You can find additional methods in the guideline in respect of MVA/Third party statements and conveyancing.