This article describes the fields in the Batch Transactions Bank Chargers module.
Overview
The Bank Charges and Interest batch type allows for capturing bank charges and interest for Trust and Business bank accounts.
The system caters for the easy administration of the Law Society bank charges and interest. The most “complex” aspect of this interaction with the Law Society is that firms are required to claim the VAT on Trust Bank Charges for their own account.
In GhostPractice, there are 2 options to deal with this. Both options require the opening of a Law Society Client. For each physical Trust Bank Account, a Matter needs to be opened and named eg: ‘Law Society Matter – Std Bank Trust Account’. It also needs to be ticked as a Law Society Matter (LPFF). Each Trust Bank General Ledger Account needs to be linked to the relevant Law Society Matter Account specific to that Trust Bank Account.
Option 1
- Business Payment and Trust Receipt to the Law Society Matter/s.
- Take the financial offsets off the matter so that the matter does not reflect in the Trust Transfer utility and therefore stops the trust transfer running automatically on these matters.
- The amounts captured to the Law Society matter/s will be the amounts reflecting as ‘redirected’ on the bank statement.
Option 2
- Run the trust transfer utility to move these amounts from the business to the trust. It is recommended to run a separate. Trust to Business Transfer for the Law Society Interest and Bank Charges.
- The transfer amount should balance back to the amounts redirected from the business account to the trust account and will be captured to Gen8 and Gen9 as usual (as opposed to the law society matter account)
Click on the Help button from the main toolbar to get assistance.
Law Society Rules
- Any interest earned on the Trust account, less Trust bank charges, is not the firm’s money but must be paid by the attorney to the Law Society via the “Attorneys' Fidelity Fund”. In a financial period, if bank charges are higher than the interest earned in the trust account, the firm shall pay the difference to avoid shortages.
- With effect from 1 March 2016, it will become mandatory for practitioners to pay over interest earned on trust current banking accounts to the Attorneys' Fidelity Fund (AFF), via the appropriate collecting law society, monthly. This amounts to a refinement on the present position whereby practitioners are obliged to pay over such interest annually. The authority for the change is contained in Reg. 8(1) to the Attorneys Act 53 of 1979 (the Act).
Top Tips
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Batch Transactions – Bank Charges and Interest
| # | Field | Description |
| 1 | Description | Enter the batch description. |
| 2 | Type | Select Bank Charges and Interest as the batch type. |
| 3 | Batch Amount | Enter the batch total amount |
| 4 | Total Debit and Total Credit | These fields will populate as batch items are entered. |
| 5 | Type | Business Bank Charges: select this type to post business bank charges. Business Bank Interest Charged: If interest was charged, select this option. Business Bank Interest Earned: Select if interest was earned. Trust Bank Charges (reflected on the Business Bank): This type is for Trust Bank charges that were charged to the Business Bank Account. Trust Bank Charges (Reflected on the Trust Bank): This is for normal bank charges reflected on our Trust Bank Account Trust Bank Interest Earned: This type is for any interest earned on our Trust Bank Account. |
| 6 | Posting Code | Select a posting code as a quick narration. |
| 7 | Post Date | Enter the post date. |
| 8 | Debit Law Society Matter Account | The default bank charges account for the branch will be in this field by default. |
| 9 | Credit general ledger Trust bank account | Enter the general ledger trust account number. |
| 10 | Narration | Enter the narration to display in the transaction history and on the statement. |
| 11 | Reference | Enter the reference. |
| 12 | Amount | Enter the Amount. |
| 13 | VAT | Select if the transaction is vatable. |
| 14 | VAT Amount | The amount will populate according to your vatable setting. |
| 15 | Save Batch Item | Click on Save Batch Item to save the entry. |