When there are insufficient funds in the trust account to effect the required lodgement to the Prescribed Account?
Because of substantial distributions of trust funds to the rightful beneficiaries early in January, it could happen that there are not sufficient trust moneys available to effect the required deposit on or before the prescribed date. For example: The lowest amount of trust moneys held in the previous year, the law practice s first year of practice, was $30,000.00. The law practice is required to deposit $20,000.00 into the prescribed account on or before 21 January (there is no money held on deposit in the prescribed account). An Estate is finalised on 10 January and following distribution of Estate funds, the trust account balance as at 18 January has reduced to $9,270.00. In such a case, the law practice would act as follows:- • The law practice cannot lodge the required $20,000.00 but is required to deposit some of the trust moneys based on January figures. • The law practice ascertains the lowest amount of trust money held between 1 January this year and 20 January this year (a dat
