Trust Accounting for Law Firms
Whether you are holding client retainers for future work, distributing personal injury settlements, managing insurance payouts – or anything in between – trust accounting is likely an important part of your law firm’s financial operations. Navigating trust accounting for law firms is challenging, requiring busy attorneys to keep a watchful eye on all client funds while juggling state bar regulations. At CPN Legal, we help lawyers manage trust accounts and remain in compliance with the use of systems like Clio and Clio’s integration with QuickBooks Online.
To learn how we can enhance your accounting practices, consider connecting with our team today.
Why Choose CPN Legal?
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Trusted by 300+ Law Firms NationwideFrom solo practices to growing firms, we help attorneys increase profitability and efficiency. Our flexible services scale with your needs.
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Proven & Recognized
We’re a Clio Gold Level Consultant, QuickBooks Elite ProAdvisor, and multi-year Clio Partner Award winner. Our accolades reflect our commitment to quality and growth.
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A Team You Can Rely On
Your firm gets a dedicated bookkeeper and team lead, plus the support of our 28-member team. We ensure accuracy, compliance, and financial clarity every step of the way.
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Law Firm Accounting, Simplified
With over 12 years of experience, we provide bookkeeping, trust accounting, KPI reporting, payroll, and financial consulting—so you can focus on practicing law.
What Are Common Errors Lawyers Run into with Trust Accounting?
As experienced professionals in trust accounting for law firms, we help our clients oversee and reconcile their accounting practices. Some of the most common errors lawyers run into with trust accounting include:
- Co-mingling funds. Lawyers are required to hold funds in an account separate from their firm’s account. Rule 1.15 of the ABA Model Rules for Professional Conduct establishes this requirement, setting forth rules for safeguarding the property of clients and third parties. Co-mingling can occur in a variety of different ways, oftentimes unintentionally. Using trust account funds to cover personal expenditures or improperly depositing money into an account, for instance, can result in commingling violations.
- Improper recordkeeping. It is necessary to keep accurate, detailed, and up-to-date records of all deposits, withdrawals, and transfers. Many lawyers run into pitfalls with recordkeeping, oftentimes due to a lack of policies and procedures for maintaining trust account records. We like to tackle this problem using legal software and automated systems, which take the stress out of proper recordkeeping and ensure compliance.
- Untimely reconciliations. Mistakes happen, especially when balancing your business’s accounting processes with your legal practice. Small mistakes can quickly spiral into major issues without time reconciliation. We perform ongoing reviews of your systems and processes to ensure that slip-ups are identified and reconciled in a timely fashion.
Can QuickBooks Online Be Used for Trust Accounting?
Yes, QuickBooks Online, when integrated with Clio, can be used for trust accounting for law firms. When these tools are properly set up, it is possible to automate trust account transactions, handle billing, and easily monitor your finances. We empower lawyers to streamline their law firm’s accounting processes with QuickBooks Online. Our team of accountants will set up your trust account, add trust liability accounts, and generate reports to keep your firm in compliance with state bar rules and regulations.