BookkeepingFor Law Firms

Bookkeeping For Law Firms

Three-Way Trust Reconciliation Service

Monthly three-way trust reconciliation comparing the adjusted bank balance, trust register, and total individual client and administrative ledgers.

A three-way trust reconciliation compares three independently supported balances as of the same date: the adjusted bank balance, the trust-account register, and the total of every individual client, matter, and applicable administrative ledger.

1Adjusted bank balanceStatement balance plus or minus documented outstanding items
2Trust registerThe book balance for the trust account
3Client ledger totalAll individual client and administrative ledger balances

What the service produces

  • Bank reconciliation through the selected statement date
  • Trust-register ending balance and transaction review
  • Schedule totaling every individual ledger
  • Comparison showing whether all three balances agree
  • List of stale checks, deposits in transit, negative ledgers, missing support, and unexplained items
  • Resolution notes and a preserved monthly review packet

The monthly reconciliation process

  1. Set the cutoff. Gather complete records through one ending date.
  2. Reconcile the statement. Identify cleared activity and supported outstanding items.
  3. Confirm the register. Review the trust-account book balance and unusual entries.
  4. Total the ledgers. Include every client, matter, and applicable administrative ledger.
  5. Compare all three. Do not substitute the bank’s available balance for the calculated result.
  6. Research differences. Preserve evidence and document authorized corrections.
  7. Complete review. Provide the packet to the lawyer responsible for trust-account oversight.

When firms request reconciliation help

Common triggers include skipped months, a bank balance that agrees while client ledgers do not, negative matter balances, unexplained old checks, a software migration, or a prior-period transaction that changed after the month was closed. If historical periods are unreliable, the engagement may need a diagnostic cleanup before a recurring reconciliation can begin.

Official guidance and practical resources

The State Bar of Arizona describes the three required categories and identifies reconciliation errors among its common trust-account problems. Its practice resources include a three-way reconciliation form, client-ledger form, general-ledger form, and trust-account manual.

Bookkeeping and reconciliation support do not determine a lawyer’s legal or ethical obligations. The lawyer remains responsible for client funds, approvals, and jurisdiction-specific requirements.

Start with fit

Review your reconciliation needs

Tell us what needs attention. We will review the basics and follow up about fit and next steps. This is not legal or tax advice.

  • No obligation
  • Your information is used to respond to this request
  • You will know what we need before any engagement begins