Episode 5: Three Way Reconciliation - What Is It?

Welcome to Accountants Law Pod, where accounting professionals and law firms converge, hosted by Lynda Artesani, Sarah Prevost, and Steven Libhart.

Welcome back to the podcast. And this week's topic, even though we all kind of chatted before and thought it was kind of a dull topic, I think it's going to actually be a lively one. And it's the 3-way bank reconciliation, which I believe Is a kind of a nuance of 2 law firms. I don't think there's really another 3-way. Maybe you guys can correct me, but I'm gonna say real estate. Yes, real estate does that.

Yeah.

Yeah.

So I'm gonna let Steve—

You got corrected.

Describe what a 3-way bank reconciliation is.

The last time I speak up.

Yeah, I know. Well, 3-way, 2 with 3 parts, basically. 3 parts, which we got corrected yesterday, which is not correct, but whatever.

Well, so your 3-way reconciliation basically is your bank account, your trust ledger on the balance sheet, and your billing platform, you know, whether it's Clio, LeanLaw, Tabs, whatever. Those are the 3 legs of your 3-way reconciliation. And you need to keep your finger in all 3 of those pies to make sure that your client is staying in balance at any given moment, because one leg of that can go out of balance and you're looking all over the place for it. So that's, that's the basic components of a 3-way reconciliation for lawyers. Now, some of them, when we were talking before the podcast started, some do not have a billing platform. You know, they have 2 legs. You know, one is the, let's say, QuickBooks, and the other one is the bank. But then I've seen a 3rd leg, we'll call it a short leg, which is a recipe box or a spreadsheet or what have you. Mm-hmm.

A recipe box. You actually had a client?

Yes, I actually had a client several years ago that was using a recipe box and recipe cards, and that's how she was keeping track of it all. And of course she was out of— she was out of balance.

Green paper ledgers, or like our friend Seth made a green paper ledger out of a Google Sheet, and it looks just like a green paper ledger. Sarah actually had a client that had green paper ledgers that she had to decipher Which was no short task. It was a big undertaking, right, Sarah?

Yeah, it was huge. The funny thing is, like Lynda and I yesterday, somebody tried to correct us and tell us what a 3-leg is, and that they would dispute us on it.

So they would argue their point.

In that situation, that's that client pushback moment. You're just like, okay, you can There's no, like, whatever we name it, 3-way for you.

It's surprising how many of them don't know what the 3-way is.

How many times do they come to you and they say, you know, my records are in good order. The other bookkeeper, she reconciled everything. But they don't realize that reconciling everything does mean that you have to do that third piece that Clio has to balance with those subledgers, which equal the total parent. So, you know, this client was saying he had 3 ways because he had the He had the subledgers and then the parent and then the bank. And I'm like, no, but like you said earlier, Steve, the subledger and the parent are the same thing. You can collapse it down. It's the same thing. That's 2 ways. So if you're using QuickBooks Online without an outside billing platform or practice management tool, then there's no 3 ways. But a lot of times, if the bank is reconciled in QuickBooks, you've got it connected and everything works beautifully. If it's connected, that doesn't mean that the bank— just because the bank is reconciled doesn't mean that all the little pieces underneath that subledger equal the total, which equals the bank total, which is 99.9% of the time a client comes to us. That's the case. It doesn't equal. And then we're like, oh, and Sarah's a great way of presenting this. Oh, you think it balances? And she pulls that balance sheet up, collapses it down, shrinks it down. So you just see the total bank trust accounts, and you might have multiple bank accounts. and the total of the trust ledgers. And if those 2 numbers don't match, you're not balanced. And that's a really serious thing because, Steve, you want to tell all the seriousness of the compliance issue of not having a trust account that's balanced 3 ways?

Definitely. I mean, you can— you're— you, you can be punished, for lack of better words, by the regulatory agency in your state. You're required to keep it in balance and be prepared for an audit at any given time in most states. And sometimes there's a state with counties that have different regulations. I know we've talked about that before, but it's number one, as an attorney, you need to know what the regulations are in your area. And if you are licensed in more than one state, you need to know the regulations in all the states that you're licensed in and to make sure that you have those available. We have a client that we took on about 6 months ago, and I loved it. The very first consultation with him, he, he was flipping through the regulations And that really made it nice to know that he cared enough to have that ready for the consultation that we were doing. But you can be, you can be punished for it, as you know, clear up to losing your license. You can be disbarred. I read a story about an attorney here in Denver this year that was disbarred for almost 6 years.

Oh.

And so, you know, I was sitting there wondering, what is this person going to do now for a living? And several years ago, when I was working in law firms and not in my own business, A salesman came in from a collection agency, a legal collection agency, and he, he had all the verbiage down. And I was, I was listening to him talk and do his sales pitch to us why we should use his company. And I finally asked him, I said, how do you know all of this? And he said, well, I wasn't an attorney and I got in trouble with my trust account and now I work for this legal collection agency. So it happens.

It happens. Oh yeah, the trust. Even jail. Like, if you— yeah.

And now that's where we come in. That's where we come into play, though. And I've been talking to our team this week about it. AI will never replace us 100%. And our specialty, one of our major specialties, is trust ledger compliance and reconciliation. And even if AI can eventually do that, which I can't imagine it can because there's so many moving pieces, All the time. And a lot of times an attorney will, let's say Clio's not connected to QuickBooks. Okay. So they'll do their entries in Clio, but nothing travels to QuickBooks.

Right.

You know, it's—

And that's a common thing, oddly, that I see it so many times. And I've seen bookkeepers argue that on another website. They don't argue it on ours because they know how Sarah and I stand on that, that we believe it should be connected so it can be in compliance. And, you know, and Sarah, one of the things we do is we, We actually will help an attorney. I'm sure you do it too, Steve, is if they're getting audited by the bar, we'll actually help with that compliance piece. And being a cloud accountant means that you're an accountant for all different states. So we need to know all the rules for all the different areas. We actually had a client recently because there was a rule change, they sent it to us and I thought that was really nice of them to do.

That's really nice. Yeah. Oh, man.

We're currently working with an attorney whose trust account is out of balance and she wants to move her money from one bank to another.

And so we're trying to fix—

Yeah, we're trying to, we're trying to come up with that. And the bank she's with is pretty prehistoric. So we're excited that she's going to move to another bank. But the whole part being she's worried about being audited. And I said, okay, you've got us in your back pocket here. You can show that you're doing a reasonable effort. You know, you're out of balance. You've hired this other company to bring you into balance. We're working with you and providing all the steps that we're doing along the way. Keep track of those. Keep all the emails. Keep everything in case you are audited or you have to self-report. That's a whole other subject. If you have to self-report to the bar, then you've got the trail and you can show that you're making an effort to bring it back in balance and you'll probably be okay.

Yeah, you have to use that intentional moment, documentation, support. Validation, you know, it's best to hire an outside, you know, in-house is fine, but there's, we get a lot of horror stories with that. So, it's a good checks and balance, just an overseeing capacity is another way to do that.

Yep.

Like, but, you know, it's interesting because we, Lynda and I, have experienced multiple rushes of it. 'Cause it's a flurry. When'd you get your notice? Oftentimes you got notice late when you're in that situation, or you don't— you're addressing it at a late date, I should say. You didn't get your notice late, you addressed it at a late date. The part that I feel like you're really bringing up, Steve, which is so true, the complexities of the work that we do, understanding when something has been moved incorrectly, understanding when things are uncleared, what are the governing rules around When things are not cashed, what do we have to do? What's the statute for it? All of these things. And we may not have all the answers. We might have an understanding of it. But if we're not doing it as a regular routine, this 2-way, 3-way, whatever we want, you know, this trust compliance ledger that we're doing, if we're not doing it on a regular basis or it's not being presented to you, how do you know? To Linda's point, you don't. The reconciliation is garbage unless you go back and change something. And you may— we've seen that all the time— or you plug something in. So if it's not presented where, you know— and I, I personally am like, it's my personal trust money, right? Like, I gave you money to hold in trust for me to handle my case. I want that handled with care and respect in the way that I provided it to you, engaged in services. So I get the, uh, the understanding from the perspective of it's to be terrified from because it's, you know, the Bars are trying to regulate it. Then they're the first ones that have often been the ones to say, oh, just go open up another bank account and then start that.

Yeah.

That doesn't make sense at all. And then you can work through this old one. Yeah, right.

You don't know what's in the original one. How is that going to fix it? How are you going to transfer it? That actually ends up being a big epic failure because they transfer over what they think is there, and there may be more out there.

And then they may not even transfer, Lynda. That's the other thing. Just go open it up for a new case. Leave the other stuff in there until you've worked through it. You think that there's like, hurry up and work through it?

Or if they do do it, if they do transfer it, or they do close one and move to the other, They do just a transfer. So they don't actually do the formal— and they wrote a check, but they don't do that. And then they put the money in the other account, just continuing on like it's the same bank account, which is not the case. And then you have to look at it and like, well, what got moved over? You need to move it over. And then a good practice too, which I think a lot of times is completely missed, is if you've got— You know, they have one bank account that they're weaning off and they're moving into another one. I've got 2 trust accounts. You should have 2 liability accounts and then the subs under each because it's easier to figure out if something's wrong, which account is wrong. If you separate it like it is, they're separate bank accounts. But most of the times when somebody comes to you and they've— oh, I closed the bank, I moved to this other bank because I thought it would fix it. When you find that happens, it's never set up properly either. So you're trying to figure out, well, what were they thinking? And most of the times the attorney will realize that that shouldn't have been done that way. But the bookkeeper did it that way because they didn't have an understanding of what they're doing. And I think that's the biggest part of it.

Well, part of that too is, is, you know, the 3-way reconciliation is— that is quite often missed by the attorneys is outstanding checks and deposits.

Yes.

That haven't cleared the bank. And to your point with opening up the new bank account, before we do that, we ask them to provide— to go back to their checkbooks, to, you know, give us every single check you wrote So that we can go back and look and see what's really not cleared, even though you posted it and you're assuming that that's part of your 3-way reconciliation. And that's where a lot of them get hung up.

True.

At the end of the year, I mean, part of what we do when we close out the files is we're going through and we're saying, these are what's outstanding. I mean, Sarah had a— it was kind of funny we brought this up today, was that we go to the attorney and say, you know, this check's been outstanding for a while. And what did you say was the attorney said was the reason it was outstanding?

Oh my God, this person has— this particular client has decided to file with multiple jurisdictions a complaint. Basically, they want more than just whatever is refunded back to them. Or the client's in jail, or it's incarcerated. They're incarcerated, or the check's $0.28 and nobody's going to cash that, even though nobody's going to cash it. No one's going to cash that. But it's interesting because when we're saying this, it's funny, Linda, that you bring this up. And then we had this conversation this morning because I was We had one lonely check from an earlier date in March that I was inquiring about. And here came the story behind it, which was really actually good for us to know because we're like, okay, I made a remark, don't ask about this again, because clearly this individual has this strife with the firm or something, or past firm, and it's getting muddled up into all of this madness. And I'm thinking, okay, I'm not going to ask this question again on this particular check. It's good for us to know at some point we'll probably have to issue a stop payment, but you're not allowed to do that right now. And I'm sure there was a disengagement letter that went along with this, this check. But it's good for us to understand, okay, it might show zero as an account listed and it might be an inactive account, but technically it's not until that check is dealt with. But if a lot of times what will happen is people will get incarcerated, you can't get it, and then you have to figure that whole thing out. And that burden is on, you know, you kind of co-working with us, the team there, or, you know, someone on staff that needs to get validation. How do I cut this check? A lot of times you need legal advice if the attorney needs to send a whole bunch of money over to the state. There's like a whole thing that goes on behind it. What's the other part of it, right?

What do we do at the end of the year? And if there's money that just sits for so many years and it's not moving, they have an obligation, which is actually the new change in the law in Massachusetts. The bar said if the things are stale and they're older by a certain amount of time, they have to turn that money over or make the action to take— they're obligated to take the action to try to find the person.

They are obligated. Yes.

They can't just send a check and go, oh, my job's done. If it ever gets cashed, who cares? No, they have to have this obligation to complete the transaction as best to their ability. And then if they don't, it goes to that unclaimed money, which is another big ordeal. So it's a lot on them, which you can see why a lot of attorneys will try to figure out, how can I do this AR way, in an AR way, and not have to deal with trust? Because they don't want to deal with this. And also, when it comes to audits, you can get a random audit. It doesn't have to be because of a disgruntled person. It can be random by the bar. I mean, there's lots of reasons. Obviously, if a bank account goes in the red and turns upside down, you know, NSF, then you know that that's going to trigger an automatic bar.

Yeah.

Audit. You don't have— that's automatic. So if you have an attorney that you're working with that moved money from one bank account to another to fix it, and then there was an outstanding check out there that cashes 3 years later or whatever, that's going to trigger that bar audit. So you really need to know before you start moving money from Bank A to Bank B what was in Bank A before you move it, because it's just the critical piece of the 3-way. And I think I should mention too that a 3-way, a lot of times when you talk to an attorney that Do you have practice management software? No, but I have a spreadsheet that I keep track of everybody. And we've seen some interesting ways that attorneys have created spreadsheets. Some of them are really long and some of them are really wide, like, or they'll have tabs for each client and they're trying to tally it up. And 99% of the time when we get into those spreadsheets and we replicate what they say was in the bank, Yeah, it ends up being they had a wrong formula somewhere, or something got missed, or a piece got taken out. That's why you don't want to use a spreadsheet. You want to use the software. That software is going to protect you and protect that trust money, which is so critical to your job in compliance. So I think that's the—

We have— we've had situations with auditing trust accounts where we actually do go ahead and create a spreadsheet with 800 tabs and 800 clients, whatever.

Yeah.

And we have to go client by client by client to figure out what they did. And so we'll have a column for their billing software, a column for the bank, a column for the liability, and then comments and all that. And, and, you know, we have to go through every single client and then we color code all the tabs. You know, if you get a, if you get a red tab, that means that's a problem client that's going to have to have some answers. And sometimes that's been the only way to unravel it. I had one with a law firm up in Wyoming. It took me 6 months. To figure out.

Yeah, we just did one that went all the way back to 2015 and it was in QuickBooks Desktop. And I got to give it a shout out to our team because the way they approached it and did the— you know, we've got a special bunch of people that just help with this detangling stuff. And I love the way she figured out a way of not disrupting the already reconciled banks but fixing the background stuff. So she did a great job. And otherwise we are taking A lot of times they'll come to us and they'll say, well, it's not because they'll change software. I was in CosmoLex, but then I came to QuickBooks, and then I went here, and it's like, oh, add that to it. But then we also have a way of— and then the bank, because they closed the bank and moved to another bank, now they don't have access to anything but the paper statements. So you have to have a tool that can turn those paper statements into Excel spreadsheets, because we need the Excel to do exactly what you just described. It's just— it's fun. But like you said, AI is going to have a hard time replicating that. I mean, unless they have a way to make it so that it's always accurate. And it can't be because the bank will put the money in the wrong bank account even though it was deposited to the right bank account, or the person will put it in the wrong bank account, or they'll transfer a different amount out than what they said they did in the software. I mean, how is the software going to figure out the scenario? It will be hard. And that'll be— wait, Steve, you and I will be out of this by then. We'll be sitting on a beach with our toes in the sand because—

Yes.

Sarah may still have to deal with it, but you and I would be sitting back going, remember the days of spreadsheets?

Well, you know, another, another thing that throws off your 3-way reconciliation is a client who might owe $1,500 in their accounts receivable. Okay. But they pay you $2,000 and they want $500 of it to go to the retainer. And the client leaves that $500 as a credit in accounts receivable in the operating account. And right there, they're in violation.

Yep.

You know, and there it sits and it sits.

Okay, I have a question for you on that.

Yes, ma'am.

So everyone uses a particular— I'm not going to name the name of the software, but you use this particular software. The client isn't good about separating and paying a bill versus I'm giving a trust retainer. They just lump it all in and it goes in the operating account. So it's an overpayment, to your point. Well, it clearly may be in the memo, or it's obvious that this is— so I think the first thing, right, is you're supposed to have dialogue to inquire, where would you like— if they don't respond, you get no response from the client. I think to your point, you're not technically supposed to hold it unless you're depending on your state rules. You're supposed to move it into a trust account on their behalf until it's settled, right? Or issue a refund like that.

Right.

And say you've received an overpayment, we've not heard back from you. I would imagine those are like the 2 logical paths. But I think Lynda brought this up earlier where you don't get responses or you don't get information, or I don't know what that's for, or they over— I don't know. It's a number of different things, but depending on the tools you're using, that compounds the problem. And then now what, Steve? Now do you— I mean, do you— when you have negative AR, or I see this, the money came in, goes into trust, they applied it to the invoice, but the money's in trust, then they, they don't disentangle it correctly. Now what? It What do you do with that?

Is it like back to your 3-way? You've got to look at the bank, you have to look at the liability, and you have to look at the billing platform. You have to look at those 3 legs and see what happened. And, you know, working with new team members and with also with attorneys who don't understand it, the verbiage I use is we have to book what actually happened. If it happened at the bank, That's how it's going to get booked on the books, whether it's right or wrong. That's the first part of it. And to answer your question, part 2 is document the heck out of it. So if I've got that $500 extra sitting there, I'll go into the transaction in QuickBooks in the memo field and I will say left phone message for client, date, time, or, you know, emailed client, whatever happened. I put in that memo field and then it goes into our tickler system and we keep after them.

Mm-hmm.

Until they're sick and tired of hearing from us and they finally transfer the money and we can make the entry and, and all of that. But we have a spreadsheet that we will use along with our reconciliations at the end of the month that shows the uncleared checks and the uncleared deposits and all those sorts of things that make up that balance in QuickBooks and what their billing software shows in there. So we can see what the variance is and we provide that to the client as well.

Yeah, yeah. Well, anyone, I mean, really, you should at fundamental, whether it's our services or any other services, this should be a line of thought process, I imagine, right? This, this money came in, the intention of it was to go blah blah blah blah blah, but that's not how the person paid you, right? Or cash walked in the door and somebody else got credit for it, or because the names are so similar, or I mean, it just A wire came in. Well, the wire went to the wrong bank account, and that's also mucked up. It's not just a—

Or the bank took a wire fee out of the trust account when they should.

Oh, bingos.

I mean, that happens a lot.

I hate those.

I hate those.

Yeah, yeah, yeah. I mean, it's— I guess in going back, well, I find it humorous that we were schooled yesterday on potentially what a 3-way is when it really wasn't a 3-way, but okay. What— whatever you're doing, either way, the detailed records of validation is important. You create your own. I mean, some people like to use the software, like Lynda, you said the management— practice management software, not all of them offer it. There is one additional one out there that offers it. We tried to use it. It's very tedious for us. We didn't like it. We came up with our own system. Steve, I know you have your own system and you brought that up. The other part is too, It does take a long time. If you come to us with a trust mess, it takes a long time.

That's why it's crucially important to really keep the client in the loop all the way along through the reconciliation. As an example, we have one now that's working on a retainer just for the trust reconciliation part of what we do for them. And so when they, you know, use up all that retainer, we ask them to replenish it just like they do to their clients. And I, you know, continually want to keep communicating with the clients so they know where we're at. It doesn't hurt to show them the spreadsheet, say, this is what we've got client by client by client, so they can see.

Might give them a little kind of—

Yeah, yeah. And they already know.

Yeah.

Or they wouldn't have hired us.

Yeah.

But keeping them in the loop on that is so important when you're reconciling that 3-way for them to bring them back into balance. And also, it doesn't hurt if you're writing up SOPs for your company, for your team to work with on 3-way reconciliations. There's nothing wrong with providing that to the client so they get the thrust of the work that you have to do for them.

Yeah.

They can see they— and sometimes if they're working on a Saturday night at 10 o'clock on their books, which isn't uncommon, you know, because they're freaking out about something, they can go see that SOP and they're like, oh, oh. I missed this step.

But, you know, it's— there's so many things that we see right from our angle. There's so many— I don't want to call it just innocent, but this just missed moments that occur that you're busy, you're living life, you're busy. But yes, it is a fundamental, critical piece. And that's where this compliance side of it, this work, that body of work we do has so much importance. And I, I like that. For me, I like that style of work. To me, it's rewarding. It's a really big puzzle that's so, so different to look at from so many angles. And we get stumped. Even those of us that are senior at it, we get stumped at it.

How often do you have to sit down after you've worked on a trust account on the 3-way reconciliation for a while and you're like, oh wait, I've got to draw a T-account out on this? Yeah, it happens to everybody. Yeah, raise your hand because after a while you're like, wait a minute, I've got to really picture the trail on this transaction. And the transactions grow legs.

Oh yeah. And then it did. And you know, if you're batching things, not batching things, if you've got an, you know, kind of a lackadaisical way of handling it, you're not consistent in your approach to it. There's so many ways that this could This report becomes such a critical piece to us, even to our well-being and understanding of it, so that we can produce—

Always patterns. Sarah and I always go digging in and we're like, oh, there's the pattern. And you'll see it repeated by that bookkeeper or whoever was doing the data entry. And then kind of figure out some of the things. You can see where the wires weren't replenished or any of those things. I mean, that's part of it, but for sure, I just think that I think the biggest thing to pound home is that you really need a bookkeeper that knows this stuff if you're hiring a bookkeeper to do the work for your firm, because that's critical. If you ask that question in an interview and they don't know the answer to that, hopefully they're not Googling it in the background, then you really need to— I think that's the most important part of this is if they don't know what that is, then you really should be finding somebody who does. It'll save you a lot of heartache.

Well, what did we have the other day? We talked to somebody who The person claimed they knew it, understood it, understood the software. Well, that's the other complexity. If you don't understand how the software works, you don't understand the software, and you're trying to do this line of work, or you're hiring someone to do this line of work, and you're just hoping on a whim.

The software is all different. I mean, the software is different, Sarah. Sometimes I have to really crank my brain for Clio. where LeanLaw makes sense to me and vice versa for you.

Well, we've got another one that we will not name.

Yeah.

Yeah, it makes it—

You know, I like both Clio and LeanLaw, but I'm with you, Lynda. I really, really like LeanLaw's approach to the trust reconciliation. I love being able to pull it up, see the balance, look in QuickBooks, look at the bank, know what the difference is. It's really streamlined with LeanLaw. Clio's a little bit more difficult, but I, you know, Clio does a good job.

They're both great software.

Yes.

The thing about the bank matching is always what trips me up. We have to stop and think, okay, I'm doing the trust side. That's the deposit side coming in. So I have to figure out what side's going to match the transactions. You know, you have to kind of group and match, but you have to guess and group and match sometimes. And sometimes you have to go to— if they're using—

Don't guess. There's no guessing.

What are you talking about? Sometimes you got to figure out what the heck they did because they may be putting those transactions in. Well, the attorney doesn't put them in all the same date, which is what they should do. But if they don't do that or they don't put them all in, It doesn't equal, and then you have another problem. That's harder than lien law where it just— they put it in and it pushes all over. So I mean, that's the part that's a little bit harder. And I think that's why people go, oh, well, don't connect Clio. That's the worst thing you could do. No, you got to teach your attorney how to do the work properly, and then you won't have that.

Exactly.

Yeah, that's the key. I mean, that's the key.

The sad thing is, to us accounting people, the 3-way It's like candy. We like it. We want to do it because we want to figure it out. We want— I mean, it's so— oh, it's like you talk to anybody else, they're like, oh God, I don't know if I'd call it candy.

I don't know about you, Steve.

It is a bit. It's a puzzle, Linda. You really want to tie it up.

You have—

Mine is a margarita.

You're okay. All right, that's fine.

It's like candy. It's like a Baby Ruth to me, Sarah, or candy corn. Maybe that's about it. The 2 candies I don't like.

We have a person, we have a person on our team that loves puzzles, loves puzzles. You give her a trust account and she is just like, I love this. And she dives in and off she goes. And it's like, I know that she's going to get it.

You know, we had one the other day, we were looking at the books and I said, oh, lots of stuff in the reconciliation discrepancy account. That's not book— that's not reconciling. I'm sorry, I wish that account didn't even exist. Because that's a stupid account, Intuit. That's a very stupid account because it's got thousands of dollars in it. I mean, I remember talking to them about that before. This had thousands of dollars in it.

Isn't it faster? Just— no, here's the best. Oh, it's reconciled. Let me just go in and click, click, click.

That's all they did. They just clicked and said, okay. And then QuickBooks said, okay, here's where the difference goes.

Plunk.

Can you imagine being the tax person going, oh, what is this? $10,000, $15,000. It's because they didn't want to bother figuring it out.

That's where you do the Lynda thing where you pick The fly shit out of the pepper. I don't say it quite like you, but you—

you know, you didn't say it right. The pepper.

Yeah, like pepper.

If you have a solo attorney who's relatively new, it doesn't hurt to get their attention on the 3-way reconciliation and have them do it. You know, Zoom is great. We didn't have Zoom 5 years ago or whatever. You know, you can sit them down, you can share a screen, and you can say, reconcile this for me. Show me what you know. And I'm going to show you what you know, the story, right?

They know the story about the transactions. It's the same thing. So when you have these messy transactions where something's plunked into the operating account that really is a retainer, write the notes and the stories. Because 5 years from now, if you get audited or whatever, 2 years forward, you want to have that paper trail. You're never going to remember if you've got 2,000 matters to track. So have it, have the story in there. And I think that's probably the best advice we could give. And And then, and then if you're an attorney listening, hire the right people to do the work.

Can I give a plug right here to the Law Lab? Oh yeah, please do. We're going to talk about it a little bit at the end of the podcast, but the Law Lab is an excellent place if you're a law firm bookkeeper or accountant. The Law Lab is a great place to bring your specific trust challenges to because we have an open forum meeting once a month. And it's confidential. We stop the recording, we share information, it's amongst us, and we help you fix it. And, and so there's no question that you can be afraid to ask when it comes to that 3-way reconciliation, and you'll walk away going, oh yeah, now I get it.

Remember that one we did that I think Sarah might have been away and it was— you were with me and it was— we just took a file that I have as a demo file.

Oh, right, right.

I had to figure out because I messed it up. What was wrong with it? And everybody was jumping in going, I know it's this, I know it's that. And we were going through why that couldn't be, or why it could be, or great answer. So they, they learned a lot on that. Everybody's like, this was so much fun, because it was truly like deciphering a puzzle or a story. But it was a good one. We probably should do that one again, Sarah. That was a good, good session.

A good one. Yeah, I do. I think I do remember that one. I just know that I've seen— and to your point, Steve, I crack up because a lot of times open form turns out to be Um, Leo Hour. Yeah, things, um, in the, in the, in the platforms. But, um, uh, there's been some that I've assisted, uh, outside of it. Linda and I have, uh, assisted with, and sometimes I'm like, wow, that's really crazy how that was done that way. Like, I just— it's, it's like a snapshot of a viewpoint of someone doing work in this moment.

Exactly.

Yeah.

And then you step through it like, I feel like I'm going through time warp speed of—

anyways, why did they do that? Oh, I guess they thought this or this, and that's why they entered it this way. That's interesting.

Yeah, a lot of words of interesting for sure. But yeah, it's definitely for certain people. Okay, he decided it's Walter time.

That means we got to wrap up.

I know exactly. I think that means that the door needs to be opened. Oh man.

Well, this wasn't a bad dry topic. We thought it was going to be bad. I think we gave a lot of really insightful tips for everybody that's listening. And Steve, you want to take us out of here and you, and you can tell us where you're going next on your trips and travels?

Absolutely. Absolutely. So if you'd like to subscribe to the podcast, please do. And our YouTube channel. If you have questions, topic requests, or guest suggestions, you can email us at info@accountantslawpod.com. Or send us a message through our website at accountantslawpod.com. If you want to join us in the Law Lab that we just talked about, please visit the website at accountantslollab.com to sign up. You will not regret signing up for this. It's every Friday. It is way cool. I love it. And if you want to follow along with what's happening, I'm leaving tomorrow for the International Airstream Rally at Rock Springs. There's going to be 1,300 Airstreams there. And I promised Lynda and Sara that I would find an attorney in their Airstream, and I did. So next week we're going to be recording from the Airstream Rally in Rock Springs, and Susan Tucker is our guest. She is a CPA and an attorney. She's an Airstream geek like me, and we're going to meet up and we're going to do the podcast recording from there. So please watch for that coming up.

That's awesome. Yeah, I'm excited.

And I'm going to look for more attorneys while I'm there. I know that they're—

You know that.

Lynda finds them on airplanes. She finds them everywhere. I was in the elevator with somebody. I'm like, I thought we were going to kind of slow the client funnel up. Oh, well, I met this person on the plane.

Oh, it's happened to me. Yeah. But the one that I met was— that was kind of a blessing. It wasn't an attorney, but an amazing story. And I happened to be staying. I was flying to see Lynda, and I happened to sit next to this nice man, and we had a great time. And he made a comment. He's like, I actually haven't sat next to somebody I've enjoyed talking to in a long time like this. I enjoy talking to people, he said, but a lot of times everyone's got their head down, their headphones in. And so I feel like, oh, well, not trying to make social hour on the plane, but it's— She's networking. But we had a great time. And yeah, so anyways, but well, Steve, I'm, I'm so excited. And we do have, um, some special guests coming up as well, and I'm excited for those. And I can't wait for us to—

And what is happening next week?

I think we have Dan too, right? Coming on, another special guest. So we got some good stuff coming. So keep following us, like Steve said.

Sarah needs to tell us what's happening next.

Oh, the conference.

Something really big.

Scaling New Heights and How to Handle Client Pushback is the topic I will be speaking on. And this will probably air after, but that's okay because I will be happy to do it in the Law Lab for our Law Lab members. Um, and I'm looking forward to it. I— it's just, I don't know, I didn't know it was a gift I had. So now I have a gift.

Oh, it's definitely—

we're so very proud of you.

Oh, thank you, thank you, thank you. I honestly— my, uh, Misty Mejia was so sweet. She's like, it's your zone of genius. I'm like, oh my God, that's a nice—

I like that.

Oh, that's pretty deep.

I love her play on— I love the way she does things. She's amazing. So anyways, um, but yeah. And we're looking forward to meeting more people. We have more guests lined up, which will be so much fun and—

And more great topics.

So, yeah.

Until next week, everybody.

Bye-bye. Thank you.