It’s a great feeling when your trust account is in order and reconciled!
Smokeball is online software, primarily for those working in law and conveyancing. It integrates with Xero accounting software. If you haven’t seen their promotional video with Calista Flockhart, you can check it out here http://www.smokeball.com.au/calista.html. I got a giggle out of it!
If you’re new to Smokeball, here are my 10 tips for reconciling your trust account.
- If you’re moving towards a paperless practice, work from an electronic copy of your trust account bank statement instead of printing off a hard copy. If you open your Statement with Adobe Acrobat Reader you can use the Highlight Text tool to highlight discrepancies or use the Sticky Note tool to add notes. For your first few reconciliations you may feel more comfortable working from a hard copy that’s been printed out, and then progress to using electronic copies later.
- Once you select RECONCILE you can’t undo that action. So be sure to fix any discrepancies within that date period first if you can.
- Anything that is on your bank statement but missing from Smokeball will have to be recorded in the ADJUSTMENTS tab until it has been fixed and can therefore be ticked at a later date.
- Make use of the SAVE DRAFT feature – this will enable you to come back and finish reconciling when you’re ready. You’ll be able to pick-up your reconciliation where you left it.
- If you have to reverse a transaction to fix a mistake, it will default to the current day’s date and this date can’t be changed or backdated. You won’t be able to reconcile these entries until you complete the reconciliation for that period.
- Don’t select RECONCILE until you have a “0” variance in the brackets below the Reconciliation Balance figure on the right-hand side.
- Always record the details/reasons for any Reversals or Adjustments. If someone else logged into your software, would they be able to see a complete story of what has occurred and why? You’re aiming for an easy to follow audit-trail of all your clients’ trust monies and any problems that you’ve fixed.
- You can go back and print off your Bank Reconciliation reports at any time, regardless of whether you’ve closed off (clicked RECONCILE) or not.
- Save electronic copies of all your bank statements and reconciliation reports in one place and in date order so that they’re easy to find.
- Reconcile regularly. The more transactions you have, the more often you should be reconciling to keep on top of it. You don’t want to let your reconciling grow into a bookkeeping monster that you’re afraid to face!
For further information on working with trust accounts, you might like to read my post Working with trust accounts
Festival Bookkeeping specialise in helping Australian conveyancing firms with their bookkeeping needs – including trust account reconciling using software such as Smokeball and CATS. You can find out more about us on our website: http://www.festivalbookkeeping.com.au/
Happy bookkeeping…
Sarina
The savvy bookkeeping blog 
3 comments