Trust Receipts Journal – Rule 3-60(a)

This journal lists all trust deposits chronologically for all clients and records for each trust deposit:

  • the date and the amount of funds received;
  • the source, name of person or institution from whom you received the funds;
  • the form of funds received, cash, cheque, bank draft, certified funds etc.;
  • the name of the client for whom you received the funds.

The following steps are required to process a deposit of trust funds:

  1. Issue a receipt – the receipt, usually pre-numbered, should contain full particulars about the transaction including the reason the funds were paid to the practice, such as retainer, mortgage advance, settlement proceeds etc.;
  2. Photocopy the deposit instrument and note the date, file number and purpose of the deposit on the photocopy. This is an optional procedure.
  3. Record the deposit in the Trust Cheque Book Register on the cheque stub and update the running trust account balance;
  4. Record the deposit in the Trust Receipt and Disbursement Journal. Record full particulars about the deposit in your journal.  Calculate your new running  trust account balance in the journal;
  5. Post the deposit to the Client’s Trust Ledger Card. Record full particulars about the deposit in your client trust Ledger card for the specific client and matter. Calculate your new running balance on the client ledger card;
  6. Record the deposit in the Trust Bank Deposit Book.  Record the client matter number and the amount.  Total the trust deposits for the day;
  7. Deposit all receipts as soon as practicable, preferably daily in the appropriate bank accounts.  Always retain a copy of the validated deposit receipt, stamped with a bank stamp by the teller, using the duplicate deposit books supplied by the bank;
  8. Mark the trust receipts in some fashion to indicate that the trust records have been updated and the necessary entries have been recorded in the Trust Receipts and Disbursements Journal and the Client Trust Ledger Card.  An example would be the use of a ‘posted’ perma-stamp that you can date and initial.

Trust Disbursements Journal – Rule 3-60(a)

This journal lists chronologically; all trust account cheques issued for all clients and records:

  • the date and amount of the trust cheque;
  • the identity of the client on whose behalf the trust funds are disbursed;
  • the cheque or  voucher number for each payment out of trust;
  • the name of each recipient of money out of trust.

The following steps are required to process a trust cheque:

  1. Satisfy yourself as to the authority to draw the trust cheque.  An example would be a trust cheque requisition approved by the lawyer in charge of the trust account or a signed Statement of Adjustments;
  2. Record the trust cheque in the Trust Cheque Book Register. Record full particulars about the cheque on the cheque stub and update the running trust account balance;
  3. Prepare the trust cheque. Photocopy the cheque and retain a copy on file. This is an optional procedure;
  4. Record the cheque in the Trust Receipts and Disbursement Journal.  Record full particulars about the trust cheque and update the running balance in the journal;
  5. Post the trust cheque to the specific Client’s Trust Ledger card. Record full particulars about the trust cheque and update the running balance.  Check that there is sufficient funds on deposit for this client and in this trust bank account to issue the trust cheque;
  6. Have the trust cheque signed by an authorized signatory to the trust account.  Deliver the signed cheque to the person requisitioning the trust cheque;
  7. Mark the trust cheque stub in some fashion to indicate that the trust records have been updated and the necessary entries have been recorded in the Trust Receipts and Disbursement Journal and the Client’s Trust Ledger Card.  An example would be the use of a ‘posted’ perma-stamp that you can date and initial.

Trust Receipts and Disbursement Journal – Sample

DATE

PARTICULARS

DOC#

DEPOSITS

CHEQUES

BALANCE

FORM
FUNDS
RECEIVED

Sept   30 2006

Balance Forward

     

10,500.00

 

Oct   012006

Received from:
Smith- Retainer

Smith, John
Client Matter #1001

R123

500.00

 

11,0000.00

Cash

Oct   07 2006

Paid to Jones & Jones in Trust-balance due

Brown,Tom
Client Matter #1002

T1005

 

5,000.00

6,000.00