A Practical Approach to fix your Trust Account in Clio if your Software Integration breaks & How to Minimize Future Issues

**Update Feb 2023 – Clio has recently released an updated reconciliation feature embedded within the Clio Platform.   The information below remains relevant for those without the reconciliation feature, or where there are issues with historical reconciliations.

#1. Temporarily Unsync your Clio Integration with QuickBooks.  

This will ensure that you are working with a static position, and that your QuickBooks figures are not being updated with changes in Clio.


#2. Ensure your opening balance agrees:

The first thing you want to do is establish a starting point. This starting position will be where your Trust Bank Account agrees to your Clio Trust Ledger.  


At this point, you want to establish if you have any outstanding cheques that haven’t been cashed or deposited. If your Trust Bank Account and Clio Trust Ledger agree, then you likely don’t have any reconciling items – which is ideal when reconciling.


#3. Review your Clio Trust

In Clio, under ‘ACCOUNTS’ run the trust account report for the period with a start date equal to your balance date in Step #1, to the current date. This will show you all the Trust funds that have been contributed and withdrawn from the accounts in Clio.


In your Trust bank account, tick through the items line by line and match each bank item with your entries in Clio.  


You will notice in some cases you have differences, for example, a cheque that was written that hasn’t cleared will show in Clio, but it won’t show in your bank account. You will keep track of this cheque, the date, and the amount, as this is a reconciling item.    


At some point, the cheque will likely be cashed and show in your Trust Bank Account. At this point you can mark that reconciling difference as paid.


If the cheque becomes stale dated, you will need to cancel the cheque in Clio, thus removing the reconciling difference. You will then need to re-issue the cheque, or depending on the circumstances, transfer the funds to the Law Society.


There are several other reasons you may have reconciling differences, such as cheques that have been written but were missed being recorded in Clio, or funds that have been deposited in a Clio Trust account but erroneously deposited into another account – the list goes on.


#4. Check your QuickBooks Trust Account Balance

If you’ve connected your Trust Account to QuickBooks and loaded in the transactions – Congratulations!  This is the first step in eliminating unnecessary data entry.  

If you haven’t done this yet, here is a quick tutorial on connecting your bank feed.


You need to ensure that you have all your transactions booked into the Trust Account and that when you run your Balance Sheet at a period end, it agrees to your Trust Bank Statement.


Once you’ve posted all your transactions, your Trust Liability Account in QuickBooks should agree to your Trust Bank Account in QuickBooks. 


If it doesn’t agree, have a look in your QuickBooks Trust Bank Account ledger and see if there is an ‘Opening Balance’ adjustment.


This type of Adjustment is done by QuickBooks when the Trust Bank Account is connected up.  If for example, you connected your Trust Bank Account Feed at Sept 1, 2022, but in fact you opened your Trust Bank Account on March 1, 2022, then you would be missing a load of transactions.


You will want to make sure that your opening balance agrees to the Trust Bank Account at the date, or you will have no hope in reconciling the two (See Point #1).   


#5. Run a Trust Listing Report

In Clio, under Reports, run your Trust Listing Report. 


If you have done everything properly above, your Trust Listing report should now agree to your Trust Liability Account in QuickBooks.   


This ensures that you can be confident that your Trust Funds have been properly accounted for.


#6. Stay on top of your Reconciliations

The best practice is to reconcile your Trust Accounts on a weekly basis, but it is required to be done at least once a month to remain in good standing with the Law Society (The Law Society Act – By-Law – 9)


The more frequently you complete your reconciliations, the easier it will be. You will also be aware of any perpetuating errors that are being made and can rectify any procedural issues.


#7. Take the Time to Train

You may have an assistant helping reconcile the Trust accounts.


We recommending setting a deadline for completion and establish a review process to ensure the trust reconciliations are being done properly and that any reconciling items are being dealt with in accordance with regulations.


Ensure that you take the time to train the person who will be responsible for this and ensure that they have enough time to do their job properly. 


This will help ensure the person has more time to issue cheques, make deposits etc. which will lead to greater accuracy – which in turn leads to less time spent reconciling.


#8. Consider the value of your time

It’s always important to consider whether you are spending your time wisely.  If your Trust Reconciliations take you 3-4 hours every month, and you have spare time, then it probably makes sense to keep this function in-house. 


If you have a full schedule and your billable rate is $500/hr, then this is a task that should be outsourced to improve your profitability – not to mention reduce your stress levels.


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