Trust accounts

Trust accounts are maintained by law firms to hold trust money, separate from the firm’s operating funds. Trust money means money entrusted to the law practice in the course of, or in connection with, legal services provided by the practice and typically consists of money received for legal costs in advance of providing the services.

In Western Australia, the requirements and obligations for operating Trust Accounts and Controlled Money are detailed in the Legal Profession Uniform Law (WA) and the Legal Profession Uniform General Rules 2015

If a law practice holds a trust account, they must appoint an External Examiner (EE) to examine the records of that trust account annually. The appointment gives the EE statutory powers to examine their trust records and report those findings to us. An EE is a person who is qualified to be appointed to examine the trust records of a law practice or approved barristers’ clerk. The criteria that a person must meet before they may qualify to be appointed as an EE are specified in sections 155 – 156 of the Legal Profession Uniform Law (WA) and Rule 65 of the Legal Profession Uniform General Rules 2015. An EE must complete the Legal Services Council approved External Examiners trust course conducted by the Legal Practice Board, Law Institute of Victoria or NSW Law Society as part of these qualification requirements, and be a member of an approved accounting body.

Trust Accounts may also be subject to random audit by the Legal Practice Board.