Why do you need a Law Firm Accounting Management Software?

A law firm isn’t only run by a group of attorneys; you will need the right tools and right skills to get things smoothly done. Law firm accounting management software is one of those essential tools that every attorney must use to track their efficiency and prepare billing details.

The right legal accounting software gives your staff the tools they need to quickly and efficiently track the time they spend on client tasks. It also provides true mobility, so your attorneys can track that time whether they are sitting in their offices or having a working lunch.

If you’re one of the law firms who still rely on a stone-age paper system or an excel sheet to manage client accounts, then you’re likely to commit mistakes or billing errors.

Not only does it increase the chances of errors but it can lead to excessive amounts of time spent on accounting tasks.

5 Reasons why you need a Legal Accounting Management Software

Some of the essential reasons to include accounting management software are as follows

Expense tracking

Accounting management software is designed to take account of every smaller or bigger expense. From the employee overhead costs to expenses incurred on behalf of a client, you’d need to constantly maintain an accurate record to ascertain expenses. You wouldn’t want to underpay your staff nor do you want to provide a wrong bill to the client.

Accounting management software not only helps to track expenses by saving receipts or writing payments in a ledger but also prevents relying on paper receipts, bills, or oral records. It also helps to avoid the situation where the receipts and pieces of paper can go missing or the staff may forget to enter an expense into the ledger.

Accurate trust accounting

Along with tracking expenses and costs, accounting management software helps to keep accurate trust accounting. Clients rely on their attorneys to hold and keep their funds in trust. Trust accounting comes along with a lot of rules and responsibilities. One must adhere to state guidelines along with keeping the records in place. Accuracy is the key to maintain accurate trust accounting. You don’t want to be expelled from the bar association for failing to maintain your client’s fund.

The right accounting software takes each specific rule into consideration. It will allow you to collect, track, and reconcile each fund going into and out of your client trust accounts.

Invoicing

A law firm cannot charge their client without sending a proper invoice for all the costs incurred. It’s true, invoicing can be extremely time-consuming and a tedious job. If you’re wondering how it feels like, you should ask the accounts department.

Almost every law firm has upgraded its accounting method by including robust legal accounting software to help track, compile, filter, and review costs for each client. It helps to prepare invoices to be sent to the client.

With the right accounting tool, your attorneys need not look back and review client matter tasks in order to submit their times to support staff and the support staff need not run around tracking records from each attorney. Most accounting software includes a built-in system to prepare and email invoices to the respective clients. It also helps to prevent inaccuracy and consumption of time.

Reporting options

Attorneys may need accounting software that allows them to run numerous reports about the firm’s billing practices, realization, accounts receivable, and expenses. A large part of accounting is the ability to review your firm’s financial health. The right accounting software helps to run and diagnose different financial reports to ascertain crucial decision-making. You’d regularly need to gauge your firm’s profitability to ensure you’re going on the right track.

Time tracking

Accurate time tracking is the key to ascertain the time taken on each case. Its primary objective is to help prepare bill for the client. You wouldn’t want to overbill or underbill your client. For this, you need the right legal accounting software.

Jotting downtime on paper is a passé. Almost every law firm relies on the accounting software to track individual time and prepare bills accordingly. Do not damage your reputation by overcharging clients nor damage your firm’s profit margin by undercharging for your valuable services.

5 Best Accounting Management Software for Law Firms

We talked about the need and benefits of accounting management software; now let’s talk about some of the most reliable accounting software for your law firm.

In general, law firm accounting software can be obtained in one of two ways:

• Dedicated accounting software — software that does only accounting.

• Legal Practice Management software with accounting features.

Dedicated Accounting Software

One big advantage of dedicated accounting software is that it helps to keep the accounts of each client and case management separate. However, you would need to work on two different projects which may take a lot of time. Trust accounting is mandatory for law firms.

Here is the list of popular dedicated accounting software.

Xero

Xero is a full-featured accounting software that can easily convert data from QuickBooks. It offers invoicing, quotes, reporting, payroll, bank connections and reconciliation, expense management, the ability to accept payments, and more. It can also be used to manage trust accounts.

QuickBooks

QuickBooks is a popular full-accounting software mostly used by law firms. You can choose from either professional or QuickBooks online. QuickBooks Online is accessed through a web browser and doesn’t provide you with all of QuickBooks features. QuickBooks Professional includes the entire standard accounting features you may need for your accounting management need including trust accounts.

TrustBooks

TrustBooks is made specifically to manage trust accounts. Along with keeping trust accounts, it helps attorneys remain in compliance with jurisdictional requirements. You automatically generate reports to provide to the State Bar to show your compliance. It also lets you write electronic checks.

Juris

Juris is an incredibly powerful accounting system. In addition to managing trusts and the other accounting related works, it also helps you understand your billing and accounting processes better.

Legal Practice Management with Accounting

It’s an all-in-one accounting software that manages cases, client database, billing, accounting, and trust management. it tends to be more expensive than dedicated accounting software.

Tabs3

Tabs3 is popular practice management software available for law firms. It’s the accounting function for Practice Master that offers document assembly, conflict checking, client management, case management, task management, timekeeping, invoicing, business accounting, financial reports, and trust accounting.

ProLaw

ProLaw is an all-in-one practice management tool including practice management, document management, billing, and accounting features

PCLaw

PCLaw is a full-featured practice management tool for law firms. Along with accounting, it offers client management, case management, calendaring, trust management, and time tracking.

CosmoLex

CosmoLex provides calendaring, task management, and client management as well as timekeeping, billing, and trust management.

Mark Grey Law PLC is the Best Attorney Law Firm in Ankeny. We run a small private firm with few of the best Ankeny lawyers. Get in touch with us to learn more about trust management, legal accounting, billing, and case management.