Can a solicitor act as their own COFA?

At Towerstone Accountants we provide specialist accountancy services for solicitors and law firms operating under SRA regulation. This article has been written to explain Can a solicitor act as their own COFA in clear practical terms so you understand how the rules apply in day to day practice. Our aim is to help you stay compliant protect client money and make informed financial decisions.

As a practising accountant who works closely with solicitors and law firms across England and Wales, I am asked this question more often than you might expect. Compliance roles in legal practice have expanded significantly over the past decade and many smaller firms or sole practitioners understandably want clarity on whether they can take on these responsibilities themselves.

In this article, I am going to explain in clear practical terms whether a solicitor can act as their own COFA, what the role actually involves, when it makes sense to do so, and when it may expose you to unnecessary risk. I will also explore the expectations of the regulator, common mistakes I see in practice, and how firms can future proof their compliance structure as they grow.

This is not theoretical guidance. Everything here is grounded in real world experience of how firms actually operate day to day under the current regulatory framework.

What is a COFA and why the role matters

A COFA is a Compliance Officer for Finance and Administration. The role was introduced by the Solicitors Regulation Authority as part of the outcomes focused regulation framework and remains central to how law firms are supervised today.

The COFA is personally responsible for ensuring that a firm complies with:

• The SRA Accounts Rules

• Proper handling of client money

• Accurate financial systems and controls

• Prompt reporting of serious breaches to the SRA

• Maintaining accounting records that are complete and up to date

This is not a ceremonial role. The COFA is individually accountable and can be subject to investigation or disciplinary action if things go wrong.

From my perspective as an accountant, the COFA role sits at the intersection of law, finance, governance and risk. That combination is exactly why it deserves careful thought before assigning it to anyone, including yourself.

Can a solicitor legally act as their own COFA?

Yes. In straightforward legal terms, a solicitor can act as their own COFA.

The SRA rules allow a solicitor to be appointed as both:

• A practising solicitor within the firm

• The firm’s COFA

This applies to:

• Sole practitioners

• Small partnerships

• Limited companies and LLPs

There is no blanket prohibition and many solicitors do act as their own COFA, particularly in smaller firms.

However, and this is where many people misunderstand the position, being allowed to do something does not mean it is always appropriate or low risk.

The regulator expects that whoever acts as COFA is competent, independent enough to exercise judgment, and able to challenge problems honestly, even when those problems involve their own conduct.

That expectation is critical.

How the SRA views the COFA role in practice

The SRA does not see the COFA as a passive administrator. In its guidance and enforcement decisions, the regulator consistently treats the COFA as a gatekeeper.

In practical terms, the SRA expects the COFA to:

• Understand the Accounts Rules in depth

• Monitor breaches actively rather than retrospectively

• Identify patterns rather than isolated errors

• Escalate issues promptly rather than wait and see

• Keep proper breach logs and reconciliations

If a solicitor is acting as their own COFA, the SRA does not lower these expectations. In fact, scrutiny is often higher because there is no internal separation of duties.

From an accounting perspective, this is similar to a company director acting as their own financial controller. It can work, but only with strong systems and discipline.

When acting as your own COFA can make sense

In my experience, there are situations where acting as your own COFA is entirely reasonable and proportionate.

This is usually the case where:

• You are a sole practitioner or very small firm

• Client money volumes are low

• Transactions are simple and infrequent

• You have strong accounting support

• You understand the Accounts Rules thoroughly

• You are comfortable reporting yourself where necessary

Many newly established firms fall into this category. At the outset, appointing an external COFA or senior staff member may not be commercially viable and the solicitor is often the most knowledgeable person in the business.

Where this approach works best, I usually see the following in place:

• A specialist legal accountant handling bookkeeping

• Monthly or even weekly reconciliations

• Clear breach logs maintained contemporaneously

• Regular internal compliance reviews

• A conservative approach to client money

In these cases, acting as your own COFA is not about doing everything yourself. It is about retaining responsibility while delegating execution properly.

When acting as your own COFA becomes risky

There is a point at which acting as your own COFA stops being efficient and starts becoming dangerous.

Based on what I see in practice, risk increases significantly when:

• Client account balances grow

• Transaction volumes increase

• Multiple fee earners handle client money

• The firm expands quickly

• Financial pressure increases

• Time becomes scarce

The most common problems arise not from dishonesty but from overload.

Solicitors are already balancing fee earning, supervision, client care, business development, and regulatory obligations. Adding full COFA oversight on top can lead to:

• Delayed reconciliations

• Missed technical breaches

• Incomplete records

• Late reporting to the SRA

• Poor segregation of duties

From a regulatory perspective, “I was too busy” is not a defence.

Independence and objectivity issues

One of the most overlooked aspects of acting as your own COFA is independence.

The COFA must be willing to:

• Identify breaches caused by themselves

• Record those breaches accurately

• Decide whether they are material

• Report them where required

This creates an inherent conflict.

I have seen cases where solicitors subconsciously downplay issues because:

• The breach reflects badly on them

• They fear regulatory consequences

• They hope the issue will resolve itself

• They are unsure whether it is serious enough

The SRA is very clear that self assessment of breaches must be honest and objective. Failure to report is often treated more harshly than the breach itself.

This is where external oversight can add real value.

Common mistakes I see when solicitors act as their own COFA

Over the years, I have reviewed many firms where the solicitor also acts as COFA. Certain mistakes come up repeatedly.

These include:

• Treating COFA duties as an annual exercise rather than ongoing monitoring

• Assuming the accountant will spot compliance issues automatically

• Not understanding what constitutes a reportable breach

• Poorly maintained client account reconciliations

• Mixing business and client money timing errors

• Underestimating residual balances

• Failing to document decisions properly

Most of these are not intentional. They stem from misunderstanding the scope of the role.

The COFA is not just there to keep the books tidy. They are there to protect clients, the firm, and ultimately the solicitor personally.

Personal liability and regulatory exposure

This is the part of the conversation that tends to focus minds.

The COFA role carries personal responsibility. If there is a serious breach and the COFA failed to act appropriately, the SRA can take action against the individual, not just the firm.

That can include:

• Fines

• Conditions on practising certificates

• Reputational damage

• Referral to the Solicitors Disciplinary Tribunal

If you are acting as your own COFA, you are effectively supervising yourself. That does not remove liability.

From a risk management perspective, this is often where firms decide to separate roles once they reach a certain size or complexity.

The role of accountants and external support

One important point I always stress is that appointing an accountant does not transfer COFA responsibility.

An accountant can:

• Maintain compliant accounting records

• Perform reconciliations

• Identify potential breaches

• Advise on Accounts Rules interpretation

• Support breach reporting decisions

But the COFA remains accountable.

Where solicitors successfully act as their own COFA, they usually work closely with an accountant who specialises in legal practices and who is proactive rather than reactive.

This combination often provides enough challenge and oversight to reduce risk while keeping costs proportionate.

COFA and COLP interaction

It is also worth briefly touching on the relationship between COFA and COLP roles.

Many solicitors act as both:

• COFA

• COLP, Compliance Officer for Legal Practice

This is permitted, but it further concentrates responsibility.

Where one person holds both roles, the SRA expects:

• Strong governance

• Clear systems

• Proper escalation routes

• Evidence of ongoing compliance review

In very small firms, this can work. In growing firms, it often becomes unsustainable.

From a governance perspective, splitting these roles is usually a sign of maturity and reduced regulatory risk.

Practical questions to ask yourself before acting as your own COFA

Before deciding to act as your own COFA or to continue doing so, I usually encourage solicitors to reflect honestly on a few practical questions.

For example:

• Do I fully understand the Accounts Rules without relying on others?

• Am I reviewing reconciliations regularly or just signing them off?

• Would I be comfortable reporting my own mistake to the SRA?

• Do I have time every month to perform proper oversight?

• Are my systems still appropriate for the size of my firm?

• If the SRA reviewed my records tomorrow, would I be confident?

If the answers are uncomfortable, that is not a failure. It is simply a signal that additional support or role separation may now be appropriate.

When firms typically move away from self appointment

In my experience, firms usually reconsider self appointment as COFA when one or more of the following happens:

• The firm hires multiple fee earners

• Client account balances become material

• The firm incorporates or restructures

• External investment or succession planning begins

• The solicitor wants to reduce personal regulatory exposure

At that point, appointing a dedicated internal COFA or an experienced senior manager can provide balance and resilience.

Some firms also choose to appoint an external consultant to provide independent compliance reviews alongside an internal COFA.

Final thoughts

So, can a solicitor act as their own COFA? Yes, absolutely.

Should every solicitor do so indefinitely? In my professional opinion, no.

For many small practices, acting as your own COFA is a practical and sensible starting point. But it should be viewed as a phase, not a permanent solution.

The key is honesty. Honest assessment of time, competence, systems, and risk.

The COFA role exists to protect clients and the profession. When it is treated with the seriousness it deserves and supported properly, it can work well. When it is squeezed in around everything else, it becomes one of the most common sources of regulatory trouble I see.

If you approach the decision thoughtfully and revisit it as your firm evolves, you will be doing exactly what the regulator expects.

You may also find our guidance on How can a solicitor check if their accountant is SRA-approved and How does an accountant help with an SRA audit useful when reviewing related SRA and accounting obligations. For a broader overview of solicitor accounting and compliance topics you can visit our solicitors accounts rules hub which brings all related guidance together.