The Compliance Conundrum Quiz is a compliance quiz consisting of 50 randomly generated questions that are populated automatically, each day. There is a time limit of 1 hour and the quiz will automatically finalise and submit when the time runs out.
#1. Withdrawals from the client bank account are recorded to the client cash book as:
#2. What is the name given to the VAT that is due on your taxable supplies i.e your fees/expenses and vatable disbursements?
#3. If a business expects to spend more than it earns, it becomes known as what?
#4. Your firm is acting for a client and has instructed a process server to serve legal documents to a third party.
When including the cost of the process server in your bill of costs, you treat it as a:
#5. Your firm deals with estate matters and you incur and pay for probate court fees. You also pay for additional copies of the grant of probate. These copies are often sent out to third parties in order to speed up process. You pass the cost of the additional copies on to the estate.
How should you show them and treat them on your bill/invoice?
#6. The COFA is solely responsible for monitoring and controlling financial stability.
#7. The interest received on for money held in a business account is:
#8. A client bank account must contain the word ‘Client’ within the account name?
#9. You’re acting for client in a land dispute case where the client has taken action against a deceased’s estate to secure title to a property they own. The client’s place of belonging is the USA. The disputed land is the UK. You draft an invoice for £2,000.00. What VAT rate do you apply to your supply?
#10. Which of the following are NOT taxable VAT rates? *
Select all that apply:
#11. What does MLRO stand for?
#12. I no longer need to consider time frames when transferring costs (fees and disbursements) to the business account?
#13. Is it permissible to pass on the costs of conducting client due diligence as a disbursement under the AML under the money laundering regulations on to my client?
#14. The SRA has stated that it will take a more robust approach towards fines for persistent offenders in regard to the Transparency Rules. What is the maximum amount the SRA can fine a law firm?
#15. Every law firm, regardless of the type of work they do, must have their complaints handing information on their website or in another format if they don’t have a website.
#16. What is the name given to VAT that you reclaim on your purchases?
#17. When dealing with residual balances, instead of recording the payment to the charity from the client’s ledger, your firm moves the residual balance to a ledger in the name of the charity. The payment is then recorded and made from that ledger every six months.
Is this a breach of the SRA Accounts Rules?
#18. If client money is legitimately retained for a specified reason, are you required to regularly update the client?
#19. The petty cash tin is another form of business/office bank account?
#20. What is the name given to the cash flow method where the cash flow forecast predicts when cash will be coming in and out of the business at specific points in time i.e. the exact day or week in a month?
#21. To be valid for VAT purposes a credit note must be issued within:
#22. The ‘Balance Sheet Test’ is when?
#23. The Transparency Rules 2018 form part of the SRA Standards and Regulations 2019 although they were released nearly a year before the Standards and Regulations. Why was this?
#24. In law firms that are transactional, the MLRO will submit suspicious activity reports often asking for a Defence Against Money Laundering (DAML) or consent to proceed. When they have been received the NCA have how many days to respond (notice period):
#25. In a non-contentious case, the VAT tax point will be the date of the invoice, provided the invoice is issued within how long after the work is completed?
#26. Which of the following actions is an example of good leadership?
#27. When the SRA have contacted you and confirmed a date for an AML visit you will need to send the requested documents to them usually within:
#28. You’re acting for a client in respect of a divorce. Your client’s place of belonging is Spain. Your firm’s place of belonging is the UK.
Under the post Brexit VAT rules, when invoicing the client, what tax rate do you apply?
#29. You have instructed an interpreter in order for your client to be able to communicate with you or to enable your client to understand Court proceedings. The cost of the interpreter is being passed on to the client. When billed, the cost is:
#30. A cyber-attack cannot be reported by the COFA as it is not mentioned in the SRA Accounts Rules and is unlikely to result in a serious breach under the SRA Accounts Rules?
#31. You’re firm is acting for the executors in dealing with the administration of a deceased person’s estate and have sent a bill to the executors, together with the estate accounts for approval. You have asked the solicitor that is acting if you can transfer costs from the client account to the business account to discharge the bill in full. The solicitor has replied “no, as costs are not properly due”.
Is this a breach of SRA Accounts Rule 4.2?
#32. A court fee has been paid from the business account, what VAT rate do you analyse the payment to when posting to the accounts system?
#33. I no longer need to consider time frames when transferring costs (fees and disbursements) to the business account?
#34. Your firm acted for a client in the sale of commercial premises. The transaction has been completed and the firm are in the process of accounting to the client for the net proceeds of sale. Independently of this retainer, the client’s son has instructed another solicitor in your firm to act for him in buying a flat.
The father has asked your firm to retain enough money to cover his son’s legal fees and to send the balance to him. Your firm is concerned that by transferring the money to the son you may be in breach of rule 3.3.
Is this providing banking facilities?
#35. If client money is legitimately retained for a specified reason, are you required to regularly update the client?
#36. Is it permissible to issue the client with a bill of costs for an unpaid, not yet incurred, court fee?
#37. The SRA Accounts Rules require a client bank reconciliation to be carried out, completed and checked:
#38. If the NCA refuse to give us a DAML on day five of the notice period, we enter into what is known as the moratorium period which is up to:
#39. The practice-wide risk assessment will be required by the SRA as one of the most important pieces of documentation in relation to AML. It is a living document and should be updated:
#40. Your firm prepare a lot of wills and fixed fee interviews as one-off transactions for clients. However, instead of opening an individual client ledger for each client, you have a general ledger on which you record the details of each client and the costs received.
Is this a breach of the SRA Accounts Rules?
#41. If a team member makes a mistake you should:
#42. Your firm prepare a lot of wills and fixed fee interviews as one-off transactions for clients. However, instead of opening an individual client ledger for each client, you have a general ledger on which you record the details of each client and the costs received.
Is this a breach of the SRA Accounts Rules?
#43. According to Google’s Aristotle project, which characteristic of a strong team is the most important:
#44. Your firm acted for a client in the sale of commercial premises which is now completed. Your firm are in the process of accounting to him for the net proceeds of sale. Independently of this retainer, the client’s daughter has instructed another solicitor in your firm to act for her in buying a flat.
The father has asked the firm to retain enough money to cover his daughter’s legal fees and to send the balance to him.
Is this providing banking facilities?
#45. Your firm is acting for a client. The case is a criminal matter. The fee earner instructs a specialist to produce video copies of CCTV footage where the action is slowed down, hard copies of individual frames and enhanced/enlarged sections of images are produced. The cost of this service is being passed on to the client.
When billed, the cost is a:
#46. You instruct a medical reporting agency to obtain copy-medico legal documents on behalf of a client that has been involved in a road traffic accident.
Is this cost a disbursement for VAT purposes or a recharge?
#47. How is the ‘Current Ratio’ (which is sometimes also called Working Capital Ratio) calculated?
#48. The three principle money laundering offences are found in the Proceeds of Crime Act 2002 (POCA). In which sections can we find these offences:
#49. Your firm operates under the VAT Cash Accounting Scheme. Which of the following are excluded from the scheme and must be accounted for under the VAT Standard Accounting Scheme?
Select all that apply:
