The Law Society of Scotland Accounts Rules Audits/Inspections – Inspection Tips

July 16, 2013 Posted by Lynne Moffatt

Every 2 to 3 years, Scottish legal firms can expect an inspection by The Law Society’s Financial Compliance Team of Inspectors.  The following series of articles will provide tips on how to prepare and deal with these well.

1 Dealing with an inspection
2 Pre-inspection tips
3 Inspection tips
4 Post-inspection tips


For many partners, the sight of a Law Society Inspector fills them with angst. It’s the same principal when passing through airport security – you know you have nothing to hide, but you still feel the officials are suspicious of you!

The Law Society of Scotland Inspectors have a serious and important job, but you can help to make their visit as streamlined and comfortable as possible.  The purpose of an inspection is to inspect … they will ask for a variety of types of files, so do not assume they think there is something wrong because they ask to see it.

Be helpful

You will receive a ‘Pre-Inspection Questionnaire and Checklist’ before -hand. Use this to ensure all documents needed are readily available.  The Law Society understand that firm’s are turning to technology to reduce their paper storage requirements, and to simplify compliance.  However, spare a thought – they must see HUNDREDS of differing ‘systems’ (paper or electronic) so don’t expect the Inspector to just ‘know’ what you do, guide them to what they need.

Ask for clarification

During an inspection, suddenly you feel the Inspector speaks another language – you may not understand their requests.  Terminology is the biggest hurdle.  There can be several terms for the same report or document – your Cashier calls it one thing, your Accountant calls it another, The Law Society may call it something different to both of these terms. Do not worry that you do not understand – politely ask the Inspector to clarify the terminology.  Perhaps they have a copy of the same document from their last inspection of your books that will help you both to identify what is required.

Request guidance

SHOCK ANNOUNCEMENT: **No Cashroom, Partner, Cashier or System is INFALLIBLE**
Wow … mistakes can happen!  When issues are brought to our attention at an inspection – generally it is not the end of the world. We’re not referring to fraudulent activity, that’s a whole other discussion – we are referring to issues which are sometimes out of our control or a genuine mistake … at some point it will happen.  We may know exactly how to make sure it does not happen again, but may not see the issue or know what to do about it. So, ASK FOR HELP.  Chances are, the inspector will have seen a similar situation, and have experience on how it should be handled.

Follow up on points you should work on

Points raised at an inspection, will either be followed up by The Law Society shortly after your visit or they will re-check issues at a future inspection. This is to satisfy themselves that matters have been addressed.  Determine which issues require action, create a plan, and put it into action.  It may be that you need to review systems and procedures or carry out training (you or your staff).  If you don’t know where to start – get HELP from a qualified Law Accountant.

Our Scottish Law Accountants will be delighted to speak with you if you are concerned about an upcoming inspection or one that has taken place recently – call us for a friendly, impartial chat.