Legal Bookkeeping Services include many of the same tasks as a regular bookkeeper, but with an added focus on the specific financial needs of a law firm. Here's a breakdown of the typical duties:
General Bookkeeping:
- Recording Transactions: Recording all the law firm's financial transactions, including income from clients, expenses, payroll, etc...
- Bank Reconciliation: They ensure the bank statements match the firm's financial records by reconciling them monthly.
- Accounts Payable & Receivable: Legal bookkeepers manage accounts payable (paying bills to vendors) and accounts receivable (collecting payments from clients). This includes sending invoices, following up on outstanding bills, and issuing checks.
- Payroll Processing: In-house or payroll software.
Legal Specific Tasks:
- Trust Account Management: A crucial aspect is maintaining meticulous records of the law firm's trust account. Client retainer fees are deposited here, and funds are only disbursed with client approval for approved legal expenses.
- Client Ledger Maintenance: They keep accurate records of each client's account, tracking billable hours, fees, and payments received.
- Legal bookkeepers may prepare basic financial reports like balance sheets and income statements for the firm.
- Data Entry and System Management: Enter data into QuickBooks and/or CLIO.
- Real Estate Transactions: Legal Bookkeepers and/or Paralegals keep a record of disbursement sheets, checks cut for each closings, checks received from the opposing side, deposits, and balancing each closing.
Overall, legal bookkeepers play a vital role in keeping a law firm's finances running smoothly and ensuring compliance with financial regulations.