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The End Is Near: Year-End Legal Accounting Tasks

 

The end is near! The end of the year anyway.

I’m sure by now you are coming out of your turkey coma and turning your attention towards the December holidays. Maybe that means you’re placing an elf on a shelf somewhere or a mensch on a bench. Either way, if you haven’t taken the time to deal with all of the necessary year-end tasks related to your legal accounting beforehand, you could be lining yourself up to deal with extra stress and headaches you simply don’t need around the holidays.  

Here are just a few of the tasks you and your firm should start completing now, before it runs into your holiday celebrations.

Year End Legal Accounting Tasks

  1. Reconcile All Of Your Bank Accounts– 50% of businesses haven’t reconciled their accounts in the last 6 months. That means that half of the attorneys reading this right now work at a firm that is heading towards the end of the year with accounts that have yet to be reconciled. This is not something that can be ignored heading into tax season. Failure to reconcile these accounts can not only make tax season difficult but also open your firm up to ethics violations.
  2. Look Into Your IOLTA Trust Accounts– At the end of the year, it’s really important to look into your trust accounting. This is helpful in understanding if all of your client retainer balances are accurate and up to date. It will also assist you in making or collecting any outstanding payments.
  3. Take a Deep Dive Into Your Profit & Loss– Taking a deep dive into your profit and loss will ensure that all income has been posted to your accounts. It can also help you prevent leakage by making sure all reimbursable client costs has been paid or written off.
  4. Audit Your Balance Sheet– By taking a look at your firm’s balance sheet you can ensure that all of your firm’s liabilities have been paid for the year. Not only will it ensure that the liabilities have been paid, but that your firm has paid the appropriate accounts as well.

Here’s to a great 2016 and hopefully an even better 2017! We’ll be hosting a complimentary webinar Thursday, December 8th to help you and your firm prepare your legal accounting for the end of the year with our full, comprehensive checklist. All attendees will also be able to download a complimentary Year-End Legal Accounting Checklist. We hope you can join us! Register for 2016 Year-End Accounting Checklist & Tips

Rick Kabra

Dr. Rick Kabra is President of CosmoLex Cloud, creator of cutting-edge technology solutions to help solo and small law firms law firms. Rick has a Ph.D. in Electrical Engineering from NJIT and has over 10 years of experience in the legal software industry catering to the specialized technology needs of small to mid-sized law firms. Rick has given numerous seminars and published articles on legal technologies such as law practice technology management, cloud computing, and legal billing, business & trust accounting compliance.