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WHEN DO YOU START BALANCING THE CLIENT ACCOUNT

Solicitor set up in April 07, operating accounts year end Jan to Dec 07, is the six monthly report six months from starting or six months into year of trading?

The date in question is called the Balancing Date and there are two each year. Hence there are two definitions of the Balancing Date. Both are defined in SA Regulation 2(1). The first is as the date expiring six months after the commencement of the accounting period in each practice year. The second definition of the date is as the date on which the accounting period finishes. (i.e. two dates give rise to two definitions). You are concerned with the first one. In this respect the Accounting Period means the period of one year ending on the accounting date. In turn the Accounting Date means the last date of the solicitor's accounting period in each practice year. This is selected by a solicitor and notified by him or her to the Law Society pursuant to Regulation 21(2).

The effect of this is that you chose the account period in this case and it is the year ending 31/12/07. The starting date of that year is 01/01/07 irrespective of whether he was in practice at that time or not so the six months after commencement date is 30/6/07 and you will need to balance at that date.

I think it makes sense to do it as early as possible.

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