Free Law Firm Financial Checklist

Prepare and file annual financial reports in accordance with Generally Accepted Accounting Principles (GAAP).

Ensure compliance with the Sarbanes-Oxley Act (SOX), if applicable.

Review and update financial policies and procedures regularly to reflect changes in laws and regulations.

Conduct internal audits to assess compliance with financial regulations and identify areas for improvement.

Retain financial records and documents as required by law.

Maintain separate client trust accounts in compliance with state bar association rules.

Segregate client funds from the firm's operating funds.

Reconcile client trust accounts monthly to ensure accuracy and identify discrepancies.

Provide clients with timely and accurate statements of their trust account balances.

Obtain written authorization before withdrawing funds from client trust accounts.

Establish clear fee agreements with clients, detailing rates, billing methods, and payment terms.

Invoice clients promptly and accurately for legal services rendered.

Document all billable hours and expenses incurred on client matters.

Review and approve billing entries for accuracy and compliance with fee agreements.

Monitor accounts receivable and follow up on overdue payments.

Implement policies and procedures for expense reimbursement, including allowable expenses and documentation requirements.

Monitor and control non-billable expenses to ensure they are reasonable and necessary for business operations.

Review and approve all firm expenditures to prevent unauthorized or excessive spending.

Negotiate favorable terms with vendors and service providers to minimize costs.

File federal, state, and local tax returns accurately and on time.

Maintain records of income, expenses, and deductions to support tax filings.

Comply with tax laws related to employee payroll, benefits, and withholding.

Stay informed about changes to tax laws and regulations that may affect the firm's tax obligations.

Consult with tax professionals to ensure compliance and minimize tax liabilities.