Trust Account Reconciliation

The reconciliation process for a Trust Account is similar to that for other bank accounts. You will need to select the trust bank number in the Bank Reconciliation screen. (Trust bank numbers often start with a “2” e.g. 21 or 22) 

In order for your accounts to be compliant with Trust Legislation, you will need to adhere to the prescribed trust accounting procedures that requires the following processes to be run sequentially at the end of each month: 

• Reconcile accounts 
• Run Trust Reports 
• Roll accounting period 
• Commence transacting for new period 

If transactions are entered for a subsequent month before the end of month is run, there will be unreconciled / unpresented items appearing from the subsequent month and these transactions will also result in an imbalance between the Bank Reconciliation Statement and the Trust Trial Balance Statement.

We recommend reconciling (but not auditing) your trust account daily so that the account can be reconciled without issue on the end of the month (or close enough there to so as to ensure that transactions of the subsequent period have not yet been entered). As long as you have not entered transactions subsequent to month end, this will produce a report that is compliant with the legislation and represents the bank account as at the end of the month. This report should also balance with the Trial Balance, Trust Ledger, and Cash book. 

Step-by-step guide

For reconciling a Trust Account at month end:

1. Present Items from Main Menu > Accounting > Bank Reconciliation > Present Items – Tick off items until the balance reconciles with your closing bank statement balance. 
2. Print Bank Reconciliation Report from Main Menu > Accounting > Bank Reconciliation > Print Bank Reconciliation Report – Confirm that the difference is zero. 
3. List Reconciled Items from Main Menu > Accounting > Bank Reconciliation > List Reconciled Items – Print and/or save the report to a Subject File. (To save this in Excel format, export to Excel and then use the Floating File note function to save the spreadsheet to the relevant Subject File.) 
4. List unreconciled Items from Main Menu > Accounting > Bank Reconciliation > List unreconciled Items – Print and/or save the report to a Subject File. (This is optional as the items are listed on the bank reconciliation report). (To save this in Excel format, export to Excel and then use the Floating File note function to save the spreadsheet to the relevant Subject File.) 
5. Run these End of Month trust reports from Main Menu > Accounting > Trust Accounting > Trust 
   1. Print Trust Trial Balance 
   2. Print Trust Ledger report 
   3. Print Trust Cash Book 
   4. Confirm that the Trust Trial Balance is same as the Reconciled bank balance, the Trust Ledger balance and the Cash Book balance. 
   5. Print Trust No Movements 
   6. Print Trust Transaction Enquiry where the Transaction Type = Journals. This will allow to document any trust journals that were made during the month. (This shows journals between matters and also journals between different trust fund types.) 
6. Run these End of Month trust reports from Main Menu > Accounting > Trust Accounting > Trust > Reports for Publication: 
   1. Publish Trust Trial Balance (print this); 
   2. Publish Trust Ledger (print this), 
   3. Publish Trust Receipts Cash Book (printing is optional); 
   4. Publish Trust Payments Cash Book (printing is optional); 
   5. Publish Trust Cash Book (printing is optional); 
   6. Confirm that the Trust Trial Balance is same as the Reconciled bank balance, the Trust Ledger balance and the Cash Book balance. 
7. Once everything is confirmed, audit the bank reconciliation report from Main Menu > Accounting > Bank Reconciliation > Audit Reconciled Items.

 Be careful to select the correct bank account number!

The below video guide will also take you through this process.