Solicitors Accounts: Deposits

Question 1

How must deposits be held?

Answer 1

As stakeholder in a SEPARATE stakeholder account
- means they hold on trust until competition

Question 2

Requirements for stakeholder ledger account

Answer 2

Must be:
- separate
- in names of both buyer and seller

Question 3

Enter when receiving deposing money?

Answer 3

Stakeholder Account (client side)
- Credit

Cash Ledger (client ledger)
- Debit

Question 4

Entry when completion of conveyance?

Answer 4

Stakeholder Account (client side)
- Debit

Client ledger (client side)
- credit

Question 5

What happens if you are holding deposit as agent of client?

Answer 5

No need for stakeholder ledger funds credits to clients ledger alone

Question 6

How should firm hold mortgage advance?

Answer 6

Should hold in separate ledger account for lender

On completion do inter-client transfer

Lender Ledger (client side)
- debit

Borrower Ledger (client side)
- credit

Question 7

How should petty cash be paid?

Answer 7

Payment on behalf of client using petty cash must come from business account and recorded in petty cash ledger

Client Ledger (business side )
- debit

Petty Cash Ledger (business side)
- credit