Summary

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All law firms operate two main bank accounts, and two sets of accounting systems.

 

The first is the office account. This is the ordinary business account and is the firm’s own money. This is where we receive payment of invoices from clients, and make our standard payments (for instance, rent, your wages, phone bills, etc.)

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             If we have sent out an invoice to a client, their payment goes to the Office account.

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The second is the trust account. This is an account where we are holding funds on trust (i.e. taking care of the funds) for our clients. We do not own the funds in this account.

 

If we have not sent out an account, or if the payment exceeds the invoice, the funds go to the Trust account. Clients may also be asked to pay “security for costs” – a payment that goes against their later invoices. These also go to Trust.

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Trust funds are highly regulated and subject to monthly and annual audits. After all – they are not our funds, but simply funds we are taking care of. Removal of funds from a trust account without correct processes or authorisation is theft, and if performed by a solicitor, grounds for them to be removed from the legal profession permanently. In terms of administrative staff, past occasions where people have removed funds improperly have resulted in jail sentences.

 

Cash Handling Processes

 

In terms of your duties with Petersen Legal:

• Receipts in to either account need to be immediately entered on to the Accounting system in LEAP, and the client provided with a receipt (either hard copy printed, or by email.) If payment is made in cash, the funds should then be given to Joseph, or the delegated Accounts Clerk. 

 

• No payment or transfer between either account should ever occur. Due to the requirements around this, these must be left to the Principal of the firm. If you need payment to go for a bill (such as a police disclosure fee, records fee, etc.) they need to be directed to Joseph or the delegated Accounts Clerk.

 

Transfers of money between files are subject to extremely strict regulation. Signed permission from a client and signed permission by Joseph is required before this can occur.

 

• Payment Methods: We can accept cash, cheque, EFT transfer or credit card to the office account. We cannot accept credit card to the trust account due to Tasmanian regulations. If a client wants to pay in to the trust account by card, they will need to be told that we cannot do this, and select one of the other methods.

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A few parts of the invoicing window in LEAP that are less obvious:

 

• When an invoice is drawn, prepare the properly laid-out invoice by selecting the Word Bill function. Then select PL Invoice, which includes our firm details and layout. This will then save the formatted invoice to the Correspondence tab.

 

• Invoices have three status descriptions:

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• Draft-Unapproved

Leave the status as this once you have prepared the initial invoice and Word Bill.

• Draft-Approved

The solicitor with carriage has seen this account and approved it to be sent.

• Final

The boss has authorised this account to be sent. To get this authorisation, email with the subject line “File No XX-XXXX: Invoice for approval”

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With the exception of Legal Aid invoices, no account should be sent to a client unless the boss has authorised it as “final”.

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Step-by-Step Guide

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Private Paying Files: Issuing an invoice

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1. Go in to the client file on LEAP, and open the "Office Accounting" Tab.

2. Select "New Invoice" from the options across the top.

3. For the status description, select "Draft - Unapproved" (staff) or "Draft - Approved" (solicitors)

4. Click the Print icon. A message will appear saying that a WordBill will be drawn once you save the page.

5. Save the draft invoice.

6. The system will then give you types of invoice to print. Select "PL Tax Invoice".

7. Allow the system to draw theWord document and save in LEAP.

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If the client has funds in trust, you will need to manually alter the invoice to show this. Do this by inserting two extra lines of the first page, under Total Payable: "Funds Held in Trust", and "Amount Payable" and the relevant figures.

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8. When complete, email Joseph with the subject line "File XX-XXXX - Invoice for finalisation."

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Legal Aid Files - Legal Aid Contributions

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1. Go in to the client file in LEAP, and open the "Office Accounting" Tab.

2. Select the sub-menu next to the "New Invoice" button, and select Quick Invoice.

3. Two windows will open: the first for a taskcode for the invoice. Use the taskcode LACTCON. Remember that the amount of the Legal Aid Contribution includes GST. (i.e. If the LACTCON is $60.00, input $60.00 including tax.) Save this.

4. The second window is for the invoice. Select "Final" and click on the "Print" icon. After the message, save the invoice.

5. Draw the "PL Tax Invoice" precedent and save the invoice to the file.

6. Email the finalised invoice to the client with a cover letter explaining that they have a legal aid contribution to pay, to us.

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Legal Aid Files - Grants

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1. On eLodge, go in to the file for that client. It will show all active work items.

2. Select the work items you wish to claim, and select Claim.

3. The eLodge system will show you a dialogue box when it is ready to print the invoice. When ready, click this.

4. Print and save a copy of the eLodge invoice to the client's file on LEAP.

5. In LEAP, go in to the client's file and select the "Office Accounting" tab.

6. Select the sub-menu to the new "New Invoice" button, and select Quick Invoice. 

7. Two windows will open: the first for a taskcode for the invoice. Use the taskcode LACTGRANT. Again, remember that the amount of the Legal Aid Grant includes GST. You should double-check the figure here against the figure on the eLodge invoice. Remember to tick "include tax" as legal aid grants are subject to GST. 

8. The second window for the invoice. This is different to LACTCON. Select "Final" but do not hit the "Print" icon. 

9. You are now fine to save and close.

 

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