Bookkeeper360: Xero Accounting & Bookkeeping Solution

Here you can see your bank, credit card and merchant accounts, financial ratios (which are also customizable), outstanding invoices, outstanding bills, and expense claims yet to be paid. You can even opt to keep an eye on any account via the “Account Watchlist”. You can hide or rearrange dashboard items as you see fit, and this only affects you vs the entire team. In the legal profession, managing finances efficiently is as crucial as winning cases. After all, even the most prestigious law firms can’t run on legal victories alone. They need money – and lots of it – flowing in regularly and reliably to keep the gavel banging and justice prevailing.

• Our Xero accounting services for businesses help you adopt smarter accounting practices and free you to concentrate on the heart and soul of your business.
• Like many other businesses, it is common for Legal firms to obtain deposits before beginning any work.
• In fact, there is no “sync” between the two software programs — the integration is so deep, it happens automatically.
• Both Xero and QuickBooks are designed with ease of use in mind and boast clean and simple user interfaces.
• Before you decide on a piece of legal practice management software, make a list of things that are important for you in a software solution.

We prepare, update, and maintain all your financial records using Xero, letting you gain insights into your business’s financial health and is also useful for tax & audit purposes. The Xero accounting team of Cogneesol provides you with accurate and up-to-date accounting figures, helping you make well-informed and timely business decisions. It is expensive to hire, train, and maintain an in-house accounting division. Outsourcing Xero accounting and bookkeeping services eliminate such costs at large.

Interest on Lawyers Trust Accounts (IOLTA)

Xero’s Growing plan is its most popular and offers most of the software’s full functionalities at $34 per month. Xero’s Established plan, which is geared toward established businesses and includes project tracking, expense claiming, and the use of multiple currencies, comes with a $65/month price tag. PCLaw is a robust accounting software for lawyers and is streamlined toward accurate billing through their Time Entry Advisor. So, with double-entry accounting, every financial transaction gets sorted into a specific category (assets, liabilities, or equity). Double entry accounting is a helpful practice for lawyers to know about, as it provides an extra guard against errors.

However, like PC Law, it does not integrate with any modern financial management applications like Hubdoc. While many law firms prefer using a legal-specific software, it isn’t necessary for every firm. Some law firms we work with at ProFix like legal accounting software because of the added features, such as client contact portals and matter management. Of the dozens of options available, you want to choose the one that combines the powerful features you need, at a reasonable price — and that is easy for you and your staff to use. You also want to make sure the law firm accounting software you choose is one that integrates with the general ledger package your accountant or bookkeeper uses. This will save hours of data entry time as well as eliminate the possibility of errors.

Clio Manage: For legal practice management that supports accounting for law firms

When it comes to accounting for law firms, there’s no one “right” method (though you may be required to take on the accrual method). Some software platforms allow you to use accrual-based books for monthly management of the firm while also creating cash-basis statements for preparing tax returns. Look into the pros and cons of both methods for your firm, then be consistent going forward to ensure your records are accurate and easy to track. Ramp is a corporate card and spend management platform that helps businesses save money and time. Its integration with Xero enables seamless tracking of all transactions, making it easier for law firms to manage expenses and maintain accurate financial records. PCLaw is an all-in-one accounting software for law firm use, suitable for large companies with more advanced needs.

Bank statements are automatically imported and categorized, letting you see your real-time cash flow. Xero allows you to import data from other programs in both TXT and CSV format. It also allows you to import from a QuickBooks file format with Xero’s conversion tool, which converts US QuickBooks accounts from QuickBooks 2007 or later. It can automatically convert the current and previous fiscal year, and you can convert earlier years by purchasing one of Xero’s add-ons. Unfortunately, Xero cannot convert payroll information, closed purchase orders and quotes, or bill reference numbers.

Year-End Law Firm Accounting: Everything You Need to Know

And a lack of professionalism can lead to losing your clients, referrals, and growth opportunities. Related articles on how to run a more efficient, profitable law firm. Founders have enough on their plates without having to worry about their finances. We take care of the accounting so you can focus on moving your businesses forward. A long, drawn-out case can strain your resources, while a sudden influx of work can present growth opportunities.

It has to come with superior accounting features, handle client trust accounts, and maintain detailed records to properly bill clients. Interestingly, tax deductions can ease the burden when used correctly—yet not all lawyers are up-to-date on their tax deductions. Many lawyers go to one or the other extreme—they either claim everything (and possibly more than they’re allowed law firm bookkeeping to), or they’re so afraid to overstep they miss out on tax deductions. If you want your firm to stay compliant, be financially successful, and grow, you need to have an accurate and clear bookkeeping system for your law firm to follow. This could mean taking on bookkeeping tasks in-house or hiring a professional bookkeeper with experience working with law firms.

Way Reconciliation

Engaging an accounting/bookkeeping firm experienced in legal accounting processes and systems is often the first step toward long-term success. Law Firms often incurs expenses for clients that will be billed later as part of the Accounts Receivables process. It is important to allocate these costs to a Reimbursable Client Cost account rather than individual expense categories in the Income Statement.

• A custom report layout can help by presenting this information in an organized, understandable format.
• This results in wasted time, mismatched records, billing complications, and even compliance violations.
• Law Firm Accounting can be complex and overwhelming, but if structured correctly can help you manage a lean and effective law firm.
• Although Clio integrates with Xero and
  Quickbooks Online, the integration has a lot of glitches and many bookkeepers prefer to do things manually.

A custom report layout can help by presenting this information in an organized, understandable format. This not only makes it easier for clients to understand their bills, but also demonstrates professionalism and transparency, which can enhance client trust. Unlike other accounting software which makes you reconcile your accounts twice, once throughout the month and again at the end of the month, Xero allows has a continuous reconciliation.