CLIENTMONEY AND ASSETS

Question 1

ACCOUNTING FOR FINANCIAL BENEFIT

Answer 1

If you receive a fnancial beneft as a result of a client’s
instructions, you must properly account to the client for that fnancial beneft unless the client has already agreed other-wise.

If a 3rd party pays you commission for sending the client to them, you must account the commission to the client. you can either
1. pay the client or offset against their fee
2. you can retain it, if you have told the client and the client agreed that you could retain it.

Question 2

SAFEGUARDING MONEY AND ASSETS

Answer 2

You must safeguard money and assets entrusted to you by clients and by others.
Firms are subject to the same standard.
Exam Tip
If a frm loses a client’s title deeds to their house, or
legal documents, they will have failed to protect client
‘assets’.

Question 3

HOLDING CLIENT MONEY

Answer 3

You must not personally hold client mon**ey (that is, hold the client’s money in your own business account rather than in a client account) unless it relates to advance payments of
fees and expenses, and you inform the client in advance of where and how the money will be held.