Off Spirits

what exactly is bookkeeping for a law firm

The average wage for someone new to the business is $21.70 per hour. This is the equivalent of around $45,000 per year, assuming a 40-hour workweek. The advantage of hourly pay is you receive 1.5 times your average wage for hours worked more than 40 per week. In bookkeeping, extra hours are typical during the busy tax season of January to mid-April.

A legal accountant and bookkeeper will work towards the same goal — they both want to keep your law firm financially healthy and built for the future. But the way they go about law firm bookkeeping it is different, doing different tasks for the good of your law firm. That’s why we’ve put together everything you need to know about law firm accounting and bookkeeping.

Scenario #2 Billable Expense Income/Billable Expenses Method

If any of these three balances do not match, it could indicate errors in your financial record keeping and should be investigated immediately. When it comes to tracking expenses, it’s important to keep all of your receipts organized. Before meeting with a bank representative, call ahead and ask what paperwork you need to bring to your initial appointment. As every business is different, your choice of the „right bank” depends on the nature of your practice, as well as how you prefer to handle your banking transactions.

For example, if a law firm were to use Xero for bookkeeping, they would be able to see real-time insights into their finances and integrate it with Clio. This would make bookkeeping and accounting much simpler and more efficient for the law firm. When choosing an accountant for a law firm, it is important to consider several qualities.

A (very) brief history of bookkeepers

Most law firms use cash basis accounting because it’s simple to maintain. The following guide explains the fundamentals of law firm accounting and bookkeeping. The goal of bookkeeping is to have an accurate picture of your current financial standing.