Accounts

Question 1

What are the types of financial statement?

Answer 1

Sale completion statement
Purchase completion statement
Estate account
(Possibly dispute/matrimonial financial statements)

Question 2

Does the financial statement need to include all matters on the ledger, or just the ones that involve the matter? E.g. transferring from property to matrimonial

Answer 2

It needs to include everything on that ledger

Question 3

What are the two main sub-titles required for completion statements?

Answer 3

Amounts received and amounts payable

Question 4

For a sale, which way around are the main two sub-titles?

Answer 4

Sale: Amounts received first, followed by amounts payable

Question 5

For a purchase, which way around are the main two sub-titles?

Answer 5

Purchase: Amounts payable first, followed by amounts received

Question 6

For a sale, what should the total of the accounts received be called?

Answer 6

Total amounts received for sale

Question 7

For a purchase, what should the total of the accounts payable be called?

Answer 7

Total amounts to fund purchase

Question 8

What needs to be at the top of every single financial statement?

Answer 8

Completion statement - Date
Client:
Matter:

Question 9

In a sale completion statement, what should be included in the accounts payable section?

Answer 9

Sale price (first)
Payment on account of costs (that was received at the start)

Question 10

In sale completion statement, what should be included in the amounts received section?

Answer 10

Mortgage redemption (first)
Estate agents fees
Search fees
Legal professional fees

Question 11

In a purchase completion statement, what should be included in the accounts received section?

Answer 11

Purchase price (first)
Stamp Duty
Legal professional fees
Search fees

Question 12

In purchase completion statement, what should be included in the amounts payable section?

Answer 12

Mortgage advance (first)
Amount received from sale of previous house
Payment on Account of Costs (that was received at the start)

Question 13

Which side does credit go on?

Answer 13

The RIGHT side (e.g. amounts payable/assets)

Question 14

Which side does debit go on?

Answer 14

The LEFT side (e.g. amounts receivable/liabilities)

Question 15

Whenever you have a total, what should you do?

Answer 15

Put it in bold and put a line underneath it.

Question 16

For completion statements, what is the final title underneath amounts payable or received?

Answer 16

Balance Due to You

Question 17

In estate accounts, what side does beneficiaries go on?

Answer 17

The RIGHT side, under liabilities

Question 18

What are the two main sub-titles required for estate accounts?

Answer 18

Assets and Liabilities

Question 19

What should the totals be called in estate accounts?

Answer 19

Total Assets and Total Liabilities

Question 20

For estate accounts, what is the final title under total liabilities?

Answer 20

Balance for Ditribution to Beneficiaries

Question 21

What is the final title for estate accounts?

Answer 21

Beneficiaries

Question 22

How do you lay out the beneficiaries section with their percentages?

Answer 22

David Markham - 50%
Julie Markham - 50%

Question 23

When the question states that each beneficiary gets the amount outlined in interstate rules, what does that mean?

Answer 23

It is split evenly amongst them all.

Question 24

When and why would you transfer client money to a client deposit account?

Answer 24

When the money is not needed immediately, so it can earn interest.

Question 25

What does the CILEX Accounts Rules state about client money being available immediately?

Answer 25

Client money must be immediately available unless the client agrees otherwise in writing

Question 26

DEBK - receipt from client

Answer 26

Credit client account (cash)
Debit client cashbook (client ledger)

Question 27

What is the word used when correcting an entry?

Answer 27

Reversal

Question 28

What kind of things will you have to correct in DEBK?

Answer 28

Wrong dates, wrong amounts, transfers to wrong account.

Question 29

What happens if the client account falls below zero?

Answer 29

You must make up for it using funds from the office account.