Trust Accounting Procedures

Disbursements

Attorney or attorney’s paralegal/secretary issues a check requisition (See form Trust-D).
Bookkeeper pulls client’s ledger card. Checks to see:

• If there is a sufficient balance in client’s account
• When the client’s check was deposited into the Trust Account. If there has not been sufficient time after a deposit for the check to clear the bank, a check should not be issued until the deposit check has cleared.
• Once funds have been confirmed as available, bookkeeper prepares check.
• Bookkeeper returns check to requesting attorney or managing partner or person authorized on signatory cards.
• Authorized signatory reviews client’s ledger card to assure all transactions have been recorded and are correct and to confirm sufficient balance of account to fund disbursement.
• Authorized signatory signs check.
• Bookkeeper records the amount of the check on the client’s ledger card and the firm’s (bank) trust account journal. Secretary/paralegal records check on the client’s Trust Transaction Form (which is maintained in the client’s file). Balances are updated.
• Attorney prepares correspondence to client informing client of trust account transaction.

Receipts

• Attorney/paralegal/secretary prepares Trust Account Deposit Form (See form TRUST-R).
• Secretary posts deposit to client’s Trust Transaction Form (which is maintained in the client file).
• Trust account deposit form and check (or cash) are submitted to bookkeeper for deposit to the firm’s trust account.
• Bookkeeper prepares receipt voucher for client (if cash).
• Bookkeeper prepares Client Ledger for client/matter.
• Bookkeeper posts deposit to Client Ledger and (bank) trust account journal and updates balances.
• Bookkeeper completes deposit slip for bank and deposits check on date of receipt.
• Bookkeeper copies deposit slips and checks prior to making the bank deposit.

Monthly Reconciliation

• Bookkeeper reconciles the firm’s (bank) trust account journal and cash receipt book to bank statement monthly.
• Bookkeeper reconciles Client Ledger balances to cash receipt book and bank statement monthly.
• At month-end, bookkeeper copies secretary with reconciled Client Ledger sheet for each client to be reconciled with the client’s trust transaction form maintained in the client file and then filed in the client file.