Bookkeeping for law firms
A small law firm holds client money that is not the firm's, bills time or flat fees, and pays costs that are later reimbursed. Mispar keeps firm income and expenses separate from the records your trust accounting requires, and prepares monthly books in your own QuickBooks Online or Xero file. We do not replace your trust account reconciliation or give legal or ethics advice. Plans start at $229/mo.
Best for: Solo practitioners, small firms and boutique practices.
By matter type
Fee income
Tracked
Case costs
Reconciled
Operating books
Kept apart
Client funds
Where law firm books usually go wrong
- Client trust money mixed with operating funds.
- Retainers recorded as income when received.
- Costs advanced for clients mixed with firm expenses.
- Contingency fees booked at the wrong time.
How Mispar keeps your law firms books clean
Industry-specific accounts and categorization, with the reporting scope agreed before work starts.
Fees by practice area
Record fee income by practice area so flat fee and hourly work can be compared.
Case costs advanced
Track filing fees, experts and travel advanced for clients and what has been reimbursed.
Client funds
Keep client money out of firm income. Your trust account reconciliation stays with you or your required process.
Contingency fees
List fees received on contingent matters separately from steady monthly income.
Staff and contract attorneys
Reconcile payroll and contract attorney pay and tag it where useful.
Bar dues, software and insurance
Categorize bar dues, practice software and malpractice insurance as their own lines.
Credit card and online payment fees
Record processor fees on client payments as their own line, apart from fee income, and match payouts to the operating account.
Referral fees
Record referral fees paid or received as their own lines.
Court reporter and expert costs
Categorize reporter and expert bills by matter when they are advanced for a client.
Reports a law firm can use
- Retainer and unearned fee balances.
- Client costs advanced and recovered.
- Billed versus collected by month.
- Accounts receivable aging.
A simple, predictable process
From kickoff to your first clean close, here is exactly what happens.
Map accounts and billing
We list the operating account, billing tools and how client funds are held.
Set up practice tracking
Income and costs are grouped by practice area.
Reconcile each month
Fee payments, case cost refunds, payroll and card spending are matched to the operating account.
Deliver monthly statements
Monthly statements arrive ready for your CPA with an open-items list.
Illustrative example
A firm settles a case in November but the fee arrives in January. Tracking it as expected income lets the owner plan for a gap month in between. This is an illustration of the method, not a customer case or a guarantee.
Law Firms bookkeeping — your questions
Do you reconcile our trust account?
No. We keep firm books separate and do not replace your trust account process.
Can you separate practice areas?
Yes, as separate income lines.
What do you need each month to keep law firm books?
Operating account and card statements, billing system exports, payroll reports and any case cost reimbursement records.
How do you handle costs advanced for clients?
They are tracked separately until reimbursed, using a treatment agreed with your CPA.
Do you give legal or tax advice?
No. We keep the books and hand them to your CPA.
Can you track referral fees?
Yes, as separate lines paid or received per matter.
Do you handle client trust accounts?
Trust accounts have strict rules. We keep them separate in the books and follow your accountant's and bar's guidance.
Can you produce reports for the partners?
Yes. Monthly statements with income by practice area and an open-items list.
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