Transfers

what is a cash transfer

if there is a movement of cash, so for example client’s money is withdrawn from the client bank account and paid into the business bank account

what is an inter-client transfer

if a firm is holding money in client bank account for one client and stops holding the money to the order of the first client and starts holding it to the order of a second client, the change in ownership of the money must be recorded

cash transfer - payment of firm’s professional fees and disbursements

once a bill has been issued, a firm can transfer money from the client bank account to the business bank account for its own professional fees and any disbursements on the bill

other reasons for cash transfers

to advance money to a client or trust where solicitor needs to meta payment on behalf of client and insufficient client money available

replace money withdrawn in breach of rule 5.3

allow the client a sum in lieu of interest

do you make entries on cash account for inter-client transfer

no - no money is moving in or out of a bank account

entries for inter-client transfer

DR client ledger account of first client

CR client ledger account of second client