Is a new law practice required to make a deposit to the Prescribed Account?
Yes, all law practices that held trust money during the previous calendar year are required to make a deposit to the Prescribed Account unless the exemption pursuant to s70(5) of the Legal Profession Regulation 2007 applies. It should be noted that the nil balances before the first credit entry to the general trust account are ignored for the purpose of determining the lowest balance, as the law practice has not held any trust money. However, if a trust approved ADI account statement records a nil balance after the initial entry, that nil balance is an effective balance for the purpose of determining the lowest balance. When calculating the initial deposit, the law practice simply ascertains the lowest approved ADI statement balance in the previous calendar year and calculates two-thirds of that balance.
