Blog Detail

Home / Blog / Detail

Best Law Firm Accounting Software & Bookkeeping Service Reviews

Amicus Attorney and AbacusLaw are downloadable software you can use on local servers or through a private cloud for easy access and sharing that’s still secure. A retainer agreement helps establish terms for your services and payment. Learn how to set up your own retainer agreements and improve stability for your practice.

For example, the Clio Manage and Xero integration lets you apply a tax to an expense category in Clio, and that same tax amount will be applied to the client invoice in Xero. It’s essential that your firm’s bookkeeping of financial transactions and accounts be meticulous and accurate. Jane Haskins practiced law for 20 years, representing small businesses in startup, dissolution, business transactions and litigation. She has written hundreds of articles on legal, intellectual property and tax issues affecting small businesses.

  • Automated billing and other processes also help improve project and client management.
  • That includes seeing which bills need to be paid and when they’re due.
  • Although it may seem like an unnecessary expense to some practitioners, this is not typically something your office can afford to go without.
  • We recommend QuickBooks Plus and Advanced in order to get the most from your legal billing software.

Below are three options for accounting software for lawyers—all of them offer free trials. Make it easy for clients to pay online by debit or credit card via third-party payment services. Adding a ‘Pay now’ button to your client invoices encourages clients to pay promptly, improving cash flow and simplifying your law firm accounting and bookkeeping. With that said, it’s not always a simple or easy decision to choose new technology for your practice. From understanding what software benefits your law firm to choosing the best legal accounting software for law firms, read on to learn more about your options. As a lawyer, utilizing technology specifically created for the legal industry will save you time and money, especially when it comes to accounting.

Best for Small Firms Using QuickBooks

Some even have report customization options to get a clear view of what you care about most. As the 2021 Legal Trends Report found, the majority (66%) of consumers expect to pay for legal services online. This data shows that clients find software that securely accepts online credit card payments is more convenient. Online payment solutions like Clio Payments also streamlines your collections and accounting workflows. Clio is practice management software for case management, billing, accounting and client intake to support your firm’s practice at every stage of the client journey.

With the accrual method, you record revenue when it’s earned and expenses when they’re incurred—whether they’re paid right away or not. This creates a better matching of costs to the revenues earned in a given month or year. It allows for more meaningful financial management that isn’t influenced by the ups and downs of cash flow. 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.

  • Clio lets you track and invoice for billable hours and expenses and get paid with a secure online payment link for credit card, debit or eCheck payments.
  • Legal billing structures are unique, and lawyers are subject to strict ethics and accounting regulations.
  • As a lawyer, it’s your responsibility to protect client data, including data that may be stored or processed in your legal accounting software.
  • ProLaw is desktop/server-based, so it can be run on-premise or within a Private Cloud.
  • Xero is intuitive online accounting software for lawyers, attorneys, and small law firms that helps streamline your admin and bookkeeping so you have more time to practice law.

Law firms have particularly unique, if not complex, billing needs. Even solo practitioners and small firms have to track and allocate hours to clients, account for retainers and manage a variety of rates and billing options. And lawyers have to comply with strict legal and ethical requirements. We recommend QuickBooks Plus and Advanced in order to get the most from your legal billing software. Both plans allow you to get a more granular view of your practice and track billable hours by client, case, and employee.

Support

Generate financial statements like cash flow, profit and loss, or balance sheets. Businesses need reports to help assess key business performance indicators like profit and accounts receivable. Keep track of miles traveled visiting clients or heading to the courthouse, making it easier to tally for taxes or billing purposes or add to your expense reports. This website is using a security service to protect itself from online attacks. There are several actions that could trigger this block including submitting a certain word or phrase, a SQL command or malformed data. LawRuler is an intuitive legal CRM that leverages data-driven techniques to manage leads, caseloads, and retain existing clients.

Legal billing and timekeeping

Implementing cloud-based law firm accounting software is generally cost-effective as it reduces the need for substantial hardware investments and maintenance costs. Many law firms use QuickBooks for their core accounting, but acknowledge that QuickBooks does not follow the rigid Trust Accounting rules. (Some law firms try anyway, or worse yet, use an Excel spreadsheet to manage trust accounts). CosmoLex includes client and matter management, time, billing, business accounting and trust/IOLTA accounting, thereby eliminating the need for QuickBooks or other accounting software. With CosmoLex, the financials of every client/matter is front-and-center, and intrinsically linked to each case. In our extensive experience working with hundreds of law firms, here is our list of the best law firm accounting software (in no particular order).

PracticePanther

Cloud-based accounting software providers prioritize data security, employing advanced encryption and security protocols to protect sensitive information. QuickBooks Desktop is the classic, full-featured accounting software that runs on Windows PC’s. QuickBooks Online is Intuit’s cloud-based (web-based) edition, which provides much, but not all, of the classic Desktop functionality.

Research shows that over 80% of law firms have a CRM solution in play, but only 20% rate their CRM as “effective”. After all, you didn’t study the law to work on cash flow statements and financial projections. It’s daunting to jump into the world of accounting when you didn’t go to business school. In fact, according to the 2021 Legal Trends Report, only 7% of lawyers felt that law school prepared them to run a business. Detailed guides, customer support, and training sessions are often available to assist law firms in adapting to the new system efficiently. Migrating to a new accounting software solution can seem daunting, but many providers offer support and resources to facilitate a smooth transition.

Consider whether your firm would be best suited for combined practice management / accounting software (or separate software for each), and consider the specific features your law firm needs. Next, we recommend that your firm makes an inventory of the specific capabilities and features that you require in your law firm accounting software. For this, you should confer with both your legal team and your accountant. As the backbone of any successful legal practice, accounting and financial management are crucial, but often overlooked, aspects that underpin the functionality of law firms —  small and large.

Clio is a cloud-based CRM that provides lawyers with overall caseload management efficiently and conveniently. Pipedrive offers a standalone dashboard to manage clients and a bunch of automation tools to streamline mundane tasks. Real-time updates and collaborative features enable seamless communication and efficient management of financial tasks, reducing the time spent on administrative duties. TrustBooks provides comprehensive Trust/IOLTA accounting with three-way reconciliation, trust audit reports and more. TrustBooks is cloud-based which means you run it from a web browser.

Conversely, cash basis accounting recognizes revenue when you’re paid (i.e., when the cash is received) and expenses when they’re paid. The tax implications of this method also allow your firm to pay tax on income once it’s received and in the bank. Poor accounting practices, such as struggling to track billable hours or sending out invoices late, can lead to money leakage. We’ll also show you how legal accounting software can make the whole process easier (and more effective). Suppose  you choose accounting software that automatically syncs payroll functionality with time-tracking and expense apps. In that case, you can also generate pay runs with the click of a button, for better efficiency.

Legal software your entire firm can agree on

Legal accounting solutions will calculate billable hours and your preset hourly rate to create an invoice. The invoice can be sent through mail or electronically to the client. Some solutions allow clients to set up an account through a portal to pay online by credit seo for bloggers card or through an electronic bank account transfer. If your law firm doesn’t already have business bank accounts, it’s time to open them. Most firms will need three business bank accounts at a minimum—checking, savings, and a separate IOLTA or trust account.

Leave a Comment