Industries
Law firms and trust accounting
Finbryn performs three-way trust reconciliation for law firms every month, matching the trust bank account, the trust ledger and individual client ledgers against each other so client funds and firm operating funds never mix. We track retainers as earned rather than as received revenue, inside QuickBooks Online or Clio.
Management report
Illustrative client · August 2026
USD
| Line | Aug | Jul | |
|---|---|---|---|
| Revenue | 142,380 | 131,904 | +10,476 |
| Cost of sales | (51,260) | (48,115) | (3,145) |
| Gross profit | 91,120 | 83,789 | +7,331 |
| Payroll | (46,300) | (45,900) | (400) |
| SoftwareNoted | (6,480) | (5,490) | (990) |
| Rent | (8,000) | (8,000) | 0 |
| Other operating | (9,215) | (9,870) | +655 |
| Net income | 21,125 | 14,529 | +6,596 |
Reviewer's note
Software is up on last month after two seats were added mid-month. Revenue includes one milestone invoice that will not repeat next month.
Illustrative. An example of the document, not a client's figures.
Exceptions report
Where the books usually hurt
Client trust funds and firm operating funds get mixed in a single bank account instead of kept apart
Three-way trust reconciliation between the bank, the trust ledger and individual client ledgers never gets done every month
Retainers get treated as revenue when they are received instead of when they are actually earned
Case-level cost tracking for reimbursable expenses gets lost inside general firm overhead
Trust accounting is a separate discipline from bookkeeping
A law firm holding client funds in trust is not just doing bookkeeping with an extra bank account. Trust accounting rules generally require that client funds stay fully segregated from firm operating funds, that no client's trust balance ever go negative even by accident, and that the firm be able to prove, at any moment, exactly how much of the trust account belongs to each individual client.
Finbryn performs three-way reconciliation every month: the trust bank account balance, the trust ledger total, and the sum of every individual client's trust ledger balance, all checked against each other. A mismatch anywhere in that chain gets investigated and resolved before the month closes, not carried forward as an unexplained variance.
Retainers, earned fees and case cost tracking
A retainer received from a client is not revenue the day it lands. It is a liability, held in trust, until the firm actually performs work and earns it, at which point it moves from the trust account to the firm's operating account as earned revenue. Firms that skip this distinction end up overstating revenue in the month a retainer arrives and understating it in every month the work is actually done.
Case-level costs, like filing fees or expert witness charges the firm advances and later bills back to the client, get tracked against the specific matter they relate to, so reimbursable costs do not disappear into general firm overhead where nobody notices whether they were ever actually billed back.
Working with Finbryn
We work inside your existing QuickBooks Online or Clio setup rather than moving your data to a new platform. A named pod manages your account, with a recorded handover memo any time that pod changes, and trust reconciliation happens as a standard part of the monthly close, delivered by business day five.
Firms bringing trust accounting current after a gap, or switching from a bookkeeper unfamiliar with trust rules, typically start with a catch-up project priced separately from ongoing monthly bookkeeping. Pricing is published on our pricing page, and every reconciliation is reviewed by a senior principal before it reaches you.
Questions
Frequently asked questions: Law firms and trust accounting
Do you perform three-way trust reconciliation?
Yes. This is a standard part of the monthly close for any firm holding client trust funds, reconciling the bank account, the trust ledger and individual client ledgers against each other.
How do you track retainers?
Retainers are recorded as a liability held in trust when received, and moved to earned revenue only as work is actually performed and billed against the retainer.
Can you integrate with Clio or LeanLaw?
Yes. Transaction and trust ledger data from those platforms feeds into the monthly bookkeeping and trust reconciliation process.
Do you track case costs the firm advances for clients?
Yes. Advanced costs like filing fees are tracked against the specific matter, so reimbursable expenses can be billed back and matched against what was actually recovered.
What happens if a trust account reconciliation turns up a variance?
Any variance between the trust ledger, the client subledgers and the bank statement is flagged immediately rather than carried forward, because an unresolved trust variance is a compliance issue, not just a bookkeeping one. We document the discrepancy and route it to you for resolution before the next reconciliation closes.
What are the common bookkeeping challenges for a law firms and trust accounting business?
Beyond the basics, retainers get treated as revenue when they are received instead of when they are actually earned and case-level cost tracking for reimbursable expenses gets lost inside general firm overhead come up often in this industry. We build the chart of accounts and reconciliation process around those specific patterns rather than a generic template that ignores how the business actually operates.
What software do you support for law firms and trust accounting?
We work inside QuickBooks Online and Clio, along with the other tools listed on this page that are common in the law firms and trust accounting industry. If you have no file yet, we set one up in your name so you own it from day one.
Related services
- BookkeepingMonthly bookkeepingOngoing monthly bookkeeping: transactions sorted into categories, accounts reconciled and month-end reports delivered in the software you already use.
- BookkeepingCatch-up and cleanup bookkeepingMonths or years of books brought up to date and reconciled, with a written record of every adjustment, so monthly bookkeeping can start from a clean base.
Next step
Talk to the team that would run your books
A short call covers your setup, your software and what a first month would look like. You get a written scope and price after it.