An IOLTA bookkeeper maintains the accounting records used to explain whose funds are held, what changed, and whether the supporting balances agree. The service supports the firm’s controls; the lawyer still approves activity, interprets the governing rules, and remains responsible for client funds.
What IOLTA bookkeeping can include
- A complete trust-account register through the statement date
- An individual ledger for every client or matter with funds held
- An administrative ledger when required for permitted bank-charge activity
- Organization of bank statements, check images, deposit support, and transfer records
- Monthly three-way reconciliation of the adjusted bank, trust register, and client-ledger total
- An exception report for negative ledgers, stale items, missing support, or unexplained differences
- A preserved monthly packet for attorney review
The records must agree as of the same date
A bank reconciliation alone is not a three-way reconciliation. The adjusted statement balance must be compared with the book balance in the trust register and the total of all individual client and administrative ledgers. Arizona’s official guidance states that if the calculated totals do not match, or if one of the three categories is missing, the work is not a proper three-way reconciliation.
Review the State Bar of Arizona trust-account guidance and its forms, manual, approved-institution list, and helpline. Firms outside Arizona should use the rules and resources issued by their own jurisdiction.
A controlled monthly workflow
- Freeze the period. Use one statement ending date for all records.
- Post authorized activity. Record supported deposits, disbursements, transfers, interest, and bank activity.
- Reconcile the bank. Identify legitimate outstanding items without forcing a difference.
- Total every ledger. Include all client, matter, and applicable administrative balances.
- Investigate. Trace differences to source records and document the resolution.
- Review and preserve. Route the packet through the firm’s attorney-controlled approval process.
Warning signs that need attention
- The bank balance is treated as the amount available for a particular client.
- Client ledgers are missing, negative, or do not total to the trust register.
- Old checks, deposits, or transfers remain outstanding without documented follow-up.
- An integration and a bank feed recorded the same transaction twice.
- The reconciliation was prepared using different ending dates.
- Firm or personal activity appears in trust without a permitted, documented reason.
Learn before you hire
- What an IOLTA account is and how it differs from operating cash
- IOLTA bookkeeping mistakes and the records that reveal them
- Monthly three-way reconciliation checklist
- Three-way trust reconciliation service
IOLTA bookkeeping questions
Does hiring a bookkeeper transfer trust-account responsibility?
No. Bookkeeping can prepare records and identify discrepancies, but the lawyer controls client funds, approves disbursements, and remains responsible for the rules that apply.
Is QuickBooks enough for IOLTA recordkeeping?
QuickBooks may be one part of the workflow, but the firm still needs complete client-level records and the reports required by its jurisdiction. The scope should define whether client detail lives in QuickBooks, a practice-management system, or another controlled record.
Can an old reconciliation difference simply be adjusted away?
No unexplained difference should be forced to zero. Preserve the original reports, trace the difference to source records, document any authorized correction, and escalate unresolved legal or ethics questions to the appropriate authority.
Start with fit
Discuss your IOLTA bookkeeping workflow
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.
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- You will know what we need before any engagement begins