Bookkeeping can be a pain, especially if you lack the training to do it yourself. As an attorney, because you chose to attend law school instead of business school, you haven’t been taught all the tricks of the trade. Here are a few changes you can make to make your life easier when it comes to bookkeeping:
Download your banking transactions into your bookkeeping software. If you are using bookkeeping software, such as QuickBooks or Xero, you can automatically download all of your transactions as they occur. This allows you to quickly review deposits that you never put into your software and see checks or transactions that you may have forgotten. If your bank doesn’t connect with QuickBooks or Xero, you can typically download your transactions to a .csv file and then upload them manually to QuickBooks or Xero yourself.
Segregate bookkeeping duties. Employee fraud can be prevented if you segregate your practice’s bookkeeping duties. In other words, you should have different people ordering items, approving invoices, and reconciling bank statements. Furthermore, only you, as the owner of your law practice, should be signing checks, as this will enable you to review all of the money that your practice spends.
Reconcile your books more often than once a month. While you may get your financial statements once a month, If a vendor charges you more than you agreed upon or a client’s check got returned, knowing as soon as possible can help in remedying the situation. Also, a transaction can easily be forgotten after a couple of days; think about all the information that could slip by in an entire month. If you wait to reconcile monthly, you may find yourself calling your bank to get more information about a certain purchase and then later contacting the company so that they can tell you about what it is that you bought. All that precious time can be saved by reconciling your books daily or even weekly.
Have a set time or day when you pay your invoices. When you batch the payment of invoices together, you reduce the time that it takes to pay them. Rather than process them one at a time, set aside a day or time of day to pay your invoices and inform your employees and vendors of the schedule. Taking this simple step will reduce the number of emergency payments that arise in the future.
Maintain multiple banking accounts. Hopefully, you have at least two bank accounts already: your trust account and your operating account. However, you may find that having more than two accounts can make your life even easier. For example, you may have one account for your earnings, one for your expenses, and another for your payroll. By increasing the number of your bank accounts, you make it easier to track and monitor your practice’s financials.
With these changes, you can save yourself the time, stress, and money that it takes to manage your bookkeeping. If you’re still not convinced that you should be doing your own bookkeeping at all, click here to schedule a free 30-minute consultation so that we can discuss how Legal Ease Bookkeeping, LLC can help you with your books.