Handling Clients Money

Question 1

What would you have to do if you were required to hold clients’ money?

Answer 1

RICS has issued a Professional Statement on Client Money Handling, 2019:

• Client account must be kept separate and clearly identifiable
• Word client is on the bank account and cheque book
• A client must be able to have their monies on demand
• Payment of interest is agreed with a client and accounts must be kept in credit
• Regular bank reconciliation
• Accurate records are kept with a running balance available
• Annual audit and reporting obligations by certified accountant employed by RICS
• If cash receipts are used to settle transactions, make sure records show all cash transactions
• Signatories must be agreed with authorised staff and two signatories should be required
• A discrete account is for a single named client account only
• RICS Regulatory Review Visits can be undertaken by RICS usually on a routine 3 yearly basis
• Firms handling client money need to display their procedure on their website

Question 2

What are the six main areas set out in the RICS Professional Statement ‘Client Money Handling’, 1st edition 2019 effective Jan 2020?

Answer 2

1. Holding client money
2. Providing information to clients
3. Receipts of client money
4. Payments from client accounts
5. Accounting records and controls
6. Compliance

Question 3

What does the RICS run as a last resort protection in instances where an RICS regulated firm is unable to repay clients money.

Answer 3

Clients Money Protection Scheme