The SRA has published the result of its review into these 2 topics and has published its proposed changes to the rules. They intedn for them to come into force in early 2027 with a phased introduction. That is soon, given the changes firms will have to make - so firms show consider this now and plan action. Links to the full report from the SRA of its conclusions and to the draft rule changes are below.

Accounts Rules Changes - Accountant’s Reports

The SRA has written:

"The alterations to our regulatory arrangements for the accountants’ reports regime comprise:

• a requirement for all non-exempt firms to submit their accountants’ reports to us,

whether qualified or unqualified

• an annual declaration requirement for all client money-holding firms confirming their

status and key information relevant to the accountants’ reports regime

• the extension of fixed financial penalties to cover defined procedural breaches of the

accountants’ reports requirements, such as late or non-submission."

To check the rules for exemption from the requirement to have an annual Client Account Audit see this link: https://hunningsconsultancy.co.uk/solicitors-when-do-you-need-a-client-account-audit/

The SRA has, for the time being, not made it a requirement for the accountants to send a copy of the report direct to the SRA. But they might in the future. For the time being the responsibility for making sure the SRA receives your Accountant's report rests with the law firm.

Link to access the draft rules changes: https://hunningsconsultancy.co.uk/wp-content/uploads/2026/06/draft-sra-accounts-rules-and-rdpr-post-consultation.pdf

Compliance Officers Changes

The SRA has made these changes by altering the Firm Authorisation Rules.

The SRA has written:

"The proposed alterations to our regulatory arrangements on compliance roles comprise:

• new authorisation eligibility criteria, to prevent owners or managers who can

unilaterally determine or direct significant management decisions from holding one or

both key compliance roles in firms with:

- an annual turnover over £600,000 in the previous accounting period and/or

- a client money balance over £2,000,000 at any point in the most recent

accounting period.

• a partial exemption for sole owner-managers firms which are in scope by virtue of

meeting the client money threshold, preventing individuals from holding the COFA

role, only

• an exemption for firms which exceed the client money threshold because of

anomalous transactions which are not representative of the firms’ usual or expected

business activities."

Link to access the draft rules changes: https://hunningsconsultancy.co.uk/wp-content/uploads/2026/06/draft-sra-authorisation-rules-post-consultation-Compliance-Officers.pdf

This will involve some reorganisation for larger firms. Smaller firms within scope may face some challenges as they may not have enough staff to share around the roles!

The Full SRA Response to the Consultation

Please see here where you may access the full SRA response: https://hunningsconsultancy.co.uk/wp-content/uploads/2026/06/Full-Consultation-Response-Accounts-Rules-Compliance-Officers.pdf

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