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2026 Statistics
Key Facts: CLC Managing Client & Office Accounts Exam
50%
Passing Score
CLC / SQA Specification
2 Hours
Exam Duration
CLC Assessment Rules
Open-Book
Official Format
CLC Written Exam
100
Practice Questions
OpenExamPrep Bank
£745
Module Fee (approx)
Approved Providers
Monthly
Reconciliation Frequency
CLC Accounts Code
CLC Managing Client and Office Accounts tests essential legal accounting and compliance skills under the CLC Accounts Code. The official assessment is a 2-hour supervised open-book written exam with a 50% pass mark. Key domains include regulatory compliance, double-entry bookkeeping, client/office account transfers and reconciliations, VAT and client interest calculations, and year-end trial balances and accountant reports. This practice bank offers 100 high-quality MCQ questions with calculations as an English-language study adaptation.
Sample CLC Managing Client & Office Accounts Practice Questions
Try these sample questions to test your CLC Managing Client & Office Accounts exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.
1What is the primary objective of the Council for Licensed Conveyancers (CLC) Accounts Code?
A.To maximize interest revenue earned by conveyancing practices on firm capital
B.To safeguard client money and ensure it is kept strictly separate from office funds
C.To eliminate the requirement for annual independent financial audits
D.To allow practices to use client deposits for temporary business cash flow needs
Explanation: The fundamental purpose of the CLC Accounts Code is to protect client money held in trust by licensed conveyancing practices. It mandates that client funds must be segregated from the firm's operational money at all times to prevent co-mingling and misuse.
2Which of the following best defines 'Client Money' under the CLC Accounts Code?
A.Money held or received by a practice for or on account of a client, including conveyancing purchase funds and unbilled disbursements
B.Funds drawn from the practice bank account to pay partner profit distributions
C.All cash held in the office safe regardless of origin or ownership
D.Money billed and paid by clients for completed legal fees and VAT
Explanation: Client money encompasses all money held or received by a practice for or on account of a client or third party in connection with legal services. This includes purchase deposits, mortgage advances, and money held for unpaid disbursements.
3Where must client money held by a CLC regulated practice be deposited?
A.In a designated Client Bank Account at a recognized bank or building society in England & Wales
B.In an offshore investment account to maximize yield
C.In the practice's main operational office account pending transaction completion
D.In a personal bank account belonging to the Licensed Conveyancer
Explanation: Client money must be deposited into an account at a bank or building society branch in England and Wales that is designated as a Client Account. The title of the account must include the word 'Client' to notify the bank of its trust status.
4Under the CLC Accounts Code, what is the regulatory rule regarding overdrawing an individual client ledger account?
A.Overdrawing a client ledger account up to £1,000 is permitted for up to 14 days
B.Overdrawing a client ledger account is strictly prohibited under any circumstances
C.Overdrawing is allowed if authorised in writing by the Senior Partner
D.Overdrawing is permitted provided the firm's total bank account has a net credit balance
Explanation: An individual client ledger account must never be allowed to fall into a debit (overdrawn) balance. An overdrawn client ledger indicates that money belonging to other clients is being used to fund that client's payments, which is a serious breach of trust.
5If office money is mistakenly paid into a Client Bank Account, what action must the practice take upon discovery?
A.Leave the money in the client account until the financial year-end audit
B.Transfer the money out of the client account to the office account immediately
C.Forfeit the funds and credit them to a general client amenity pool
D.Notify HMRC before making any ledger correction
Explanation: When office money is incorrectly deposited into a client bank account, it must be transferred out to the office bank account immediately upon discovery to maintain proper segregation of funds.
6Why does the CLC Accounts Code strictly require the duty of segregation between client and office funds?
A.To ensure client money is protected from the firm's creditors in the event of insolvency
B.To minimize the amount of VAT payable on legal fees
C.To allow the bank to automatically deduct monthly service charges from client balances
D.To simplify partner profit-sharing calculations at year end
Explanation: Segregation ensures that client money is held on trust and remains ring-fenced from firm liabilities. In the event of practice insolvency or bank execution against the firm, client money cannot be taken to satisfy firm debts.
7What is the required timeframe for paying client money received by a practice into the Client Bank Account?
A.Within 14 working days of receipt
B.Without delay, and normally on the day of receipt or the next working day
C.By the last day of the calendar month
D.Whenever the conveyancer completes the transaction file
Explanation: The CLC Accounts Code mandates that client money must be paid into a client bank account without delay, which normally means on the day of receipt or the next working day.
8Before a practice can transfer funds from the Client Bank Account to the Office Bank Account in payment of legal fees, which condition MUST be satisfied?
A.A bill of costs or written notification of costs must have been delivered to the client
B.The client must sign a formal receipt at the practice offices in person
C.The annual Accountant's Report must have been approved by the CLC
D.The transaction must have been registered at the Land Registry
Explanation: Client money can only be transferred to the office account for fees if a bill of costs, or other written notification showing the precise amount of costs, has been dispatched or delivered to the client.
9A practice discovers an inadvertent shortfall of £400 on a client ledger account caused by a bank posting error. What immediate obligation rests on the practice under the CLC Accounts Code?
A.The practice must immediately replace the £400 shortfall out of its own office funds
B.The practice may wait 30 days for the bank to investigate before taking action
C.The practice must write off the shortfall against the client's deposit
D.The practice must report the client to credit reference agencies
Explanation: If a shortfall arises on a client ledger account for any reason, the practice must immediately pay office money into the client bank account to eliminate the deficit while investigating the underlying cause.
10A practice receives a single cheque from a client containing £5,000 for a conveyancing deposit and £600 for an outstanding office fee bill. How should this mixed cheque be processed?
A.Pay the entire cheque into the Client Bank Account first, then transfer £600 to the Office Bank Account
B.Pay the entire cheque directly into the Office Bank Account
C.Refuse the cheque and demand two separate payments from the client
D.Endorse the cheque over to the seller's conveyancers directly
Explanation: When a cheque or payment contains a mixture of client money and office money, the entire cheque must be paid into the Client Bank Account intact. The office money element must then be transferred to the Office Bank Account promptly (normally within 14 days).
About the CLC Managing Client & Office Accounts Practice Questions
Verified exam format metadata for CLC Diploma — Managing Client and Office Accounts is pending. The practice questions above remain available while official exam length, timing, passing score, fee, and administrator details are reviewed.