In this instructional video, Lynda Ardisani introduces bookkeeping professionals to the specific language and processes involved in working with law‑firm clients. She defines key terms such as trust accounts, retainers, IOLTA, advanced client costs, and matters, emphasizing the compliance risks of mishandling client funds. Ardisani then walks through a step‑by‑step workflow in the LeanLaw software: creating a new client, adding a matter (e.g., an estate‑planning case), and using the QuickBooks connector to push the client and matter into QuickBooks as a customer and sub‑customer. She demonstrates how to set up a trust account for the client within LeanLaw, sync it to QuickBooks, and verify the account appears correctly in the Chart of Accounts as an “Other Current Liability” trust account. The video highlights how LeanLaw streamlines trust‑account bookkeeping, reduces audit risk, and integrates seamlessly with QuickBooks, positioning the tool as essential for accountants serving attorneys.
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Hi there, Lynda Ardisani, Ardisani Bookkeeping. So for today's video that's going to go with the post that's, that's for today, I wanted to dive into a little bit of what it's like to work with attorneys. A little bit about the lingo, the language that they use so you're familiar, especially if this is your first attorney client, you might get a little confused on some of the terms. So I'm hoping to maybe explain it a little bit and in a way that maybe is easy to understand and also get into the steps to sign up your first client into the application LeanLaw that I highly recommend with working with QuickBooks and law firms because it's just going to simplify and make trust accounting way easier. Speaking of trust accounting, that's the first piece of lingo. So a trust account and an attorney that uses— has trust accounts. It's the place that you would— I liken it to a little separate checking account for the client. So it's where you would put the deposit, so which is called the retainer. So here we start to get into the terminology. So if you want to think of it this way, the client prepays for services. So the attorney takes in those funds before they've even earned it. So a trust account is where you put those funds. Really important because of compliance issues. You need to make sure that those attract Like, because it's not the attorney's money, so it has to be tracked very specifically. And there's a lot of laws around this, so an attorney can actually lose their license to practice if they mismanage the funds. So really super important to make sure that the funds are set up. And the accounting is set up the right way so that there's no chance if you are ever audited, there's no chance that you could ever see that this money was ever used in any other way than a prepayment on their account. When the, when the revenue is earned, that's when you invoice the client. And then that's when the action of moving the funds out of the trust account to the income account for the attorney. So an IOLTA account is the— it's an acronym for Interest on a Lawyer Trust Account. And the interest, it's in— you have the account, the funds are put into an interest-bearing account, and the funds are actually used to help people who— clients that don't have any money be able to afford an attorney. So that's what that account is for. But that's a little bit of the lingo that I was talking about that you may or may not have heard of. Advanced client costs is another one. And you can think of that as, you know, the attorney is hired, the money's put into the retainer, is put into the client account, and then some fees start to come in. Maybe they have to hire an investigator, or maybe they have to hire— or maybe it's a personal injury attorney and you've paid— the attorney's paying some of the bills, the hospital bills for the client that had the accident. So in that case, those funds are advanced. So the law firm actually advanced the costs. And then when they do the billing, they add that back to the billing. So when they bill the client, the client reimburses them with the funds that are in the trust account. So that's another term that you may hear around attorneys that you may be like, what is that? Of course, matter, it just means the case or, you know, the case that the client— if you're an estate planning lawyer, it's to develop the estate. Another way to look at his job, simple, simple, simple terms. So let's get into LeanLaw. I'm going to take you through some of the steps just to add a client, add a matter, and then and see how that pushes into QuickBooks and some of the little, the little places that you can click in LeanLaw that will help you kind of navigate through real quickly to get into QuickBooks to find specifically what you're looking for. So let me share my screen here. Here we are in LeanLaw. And this is the first place that shows up when you are logging in to LeanLaw and takes you to the calendar view just by default. So if you want to add a customer or client, what you're going to do is you're going to actually click the plus sign just like you do in QuickBooks here in the right-hand corner, and then select Add a Client. So you can add a client from here, you can add a matter from here. So if I click on this, you'll see Add a Client, Add a Matter. It's just same thing as QuickBooks. You've got the ability to do all of these things. You can deposit right into trust, which is the retainer, which we'll get into in a subsequent week. So add a client. And then you can also add a company name. So if you work at a firm that deals with working exclusively with companies and not with individual clients— I have a client that's a construction attorney. So what he would do is he would— he works exclusively with companies. So people sue the construction firms and he represents them. So then he would be dealing mostly with companies and the company would be paying him. Most of the times though, you, when you work with them, they work with people. So let's go in here and just add Francis Thompson as a name. And then you can get in here and do the address and all that. I'm not going to go through those steps here, but, and I'll show you there's another place you can actually go in there and do that as well. So I'm going to create the client. Now I'm going to add the matter. So like I said, this is an estate plan, estate planning. This person came in and wants some estate planning. They want to work through their wills and the last will and testament. They want to create an estate so that their family is taken care of after their, after their passing. So you can come in here, you can pick hourly. The ID is automatically set up because I set that up in settings in LeanLaw. But it's this simple. So what I'm doing is I'm creating the client, I'm creating the matter, but that's only in LeanLaw, is not yet in QuickBooks. And I can push this into QuickBooks really simply. So all I'm going to do is to come over to the QuickBooks button, right? Simple. I told you this program is really intuitive. It's really easy to use. Click the QuickBooks button. I've already preset it for Matter billing. So I'm just going to click QuickBooks connector. Say that fast 3 times and create my accounts in QuickBooks. So because these names weren't in there, I'm going to create a new customer and a new sub-customer, which is the terminology in QuickBooks, which would be your matter or your client matter. But if there were— if they were already in QuickBooks and they were coming back to me for a second time, I would actually go and find those customers in QuickBooks and LeanLaw will do that. It's connected. So here, I'm just gonna hit Save Changes. And I happen to have my account open in QuickBooks. But if it wasn't open, I still could get there really simply. So here it is, Francis Thompson. How do I know it's in QuickBooks? Well, I could hop over to QuickBooks and go to the Customer tab and look for them. I could just jump over here and look. But really easily, you can go over here and then say View in QuickBooks. So I have to go searching through all the names, especially if I have a lot of names. It's really easy to come right here and Boom, there she is. And then I can see right under her name is her subaccount or her matter. Now that means I've added a customer, but does it mean I've added the trust account? No, it doesn't. That's an extra step because not every client— I've worked with a couple of few law firms and some of them don't always have work. In fact, that construction attorney, he does do work with trust accounts, but he doesn't always. Sometimes he does straight up fixed fee billing and there's no trust accounting at all. So in that case, I wouldn't want to always have a matter— I wouldn't want to always have a trust account added to it. So let's go over to LeanLaw. And how am I going to set up the trust accounting? Like I said, this is why this program is so wonderful. One click, I'm going to click up, set up the trust accounting. And here I go again. I can either hit save the changes, it's going to create those names right off of the customer names that I have. And just create the account. If the accounts were in there, it would find them, and I would just hit Save Changes there because it's going to connect them. So what I'm going to do is just hit Save Changes because I'm going to add them here. And there they are, they're created. So let's go check into QuickBooks to see if they're there. So I'm just going to give this a little swirl because it's been open. Come into Chart of Accounts. And I'm just going to type up Thompson. Because I know it's there, right? Real simple. Thompson, Francis, boom, there my trust accounts are set up. You can see that the detail account, the detail type is a trust account, and the type of account here is, is an other current liability. So that's it. That's how easy it is to work in LeanLaw and set up a client, set up a matter, and have it push into QuickBooks. It can't get any easier than that. So as we go through the steps in the weeks, you're going to really start to see as we build off of that how much It's how beneficial it is to add this app to your app stack when you work with attorneys. I hope that as we go through this, you'll start to be able to work with attorneys, learn the language, learn what you need to know to work within LeanLaw. So step 1, creating a client and creating a matter. Done. Step 2 will be adding the retainer and getting into more things like that. So we've, we've created the trust account, we've created the client, we've got the pieces in place for the accounts receivable. and we'll move forward from there. So I hope that was interesting and informative to you, and if you have any questions, comments, please reach out to me. If you have any suggestions for any other videos, please reach out to me. I'm more than happy to help, happy to help you. Thanks for watching. Bye now. Bye.
