The records a firm must keep when it holds client money, and the systems that prove every pound can be accounted for.
Accurate records are what stand between a firm and an unexplained gap in client account. This chapter begins with the core record-keeping obligations, what counts as an accounting record, and where responsibility for compliance sits — including the COFA's reporting role. It then works through the client ledger as the matter-by-matter record, what each entry must show, and why the client side can never go into debit, before turning to the three-way reconciliation: how often it must be done, what is compared, and who signs it off. Finally, it covers what a shortfall is and how it must be remedied, how long records must be retained, and the steps that follow when a breach is identified, including who decides whether it is material enough to report to the SRA.
