Secure your client money with ease

Client money reconciliation comes in two forms – internal and external. Both are important but internal client money reconciliations are more frequently spoken about, primarily because they must be done each business day.

Internal client money reconciliations require firms to reconcile what they hold on behalf of every client in their internal records and accounts, against what their internal records and accounts state that they  should  hold.

External client money reconciliations must be done on a regular basis by firms. This is to reconcile between their internal records and those of any third parties which hold client money.

Client money is found across many industries because it refers to any instance of an organisation holding money on behalf of a client. Examples include financial firms holding the content of pension accounts, legal firms holding deposits for mortgages, and crowdfunding organisations holding investment loans.

External client money reconciliations are carried out as often as they need to be. However, between each instance, no longer than one month must pass.

The FCA have a number of regulations relating to client money to protect individuals. Most of these are outlined under either CASS 5 or CASS 7. For a full insight into the FCA’s exhaustive list of client money rules, they can be found on their site.