November 01, 2013 Law Practice Management

Charting a New Financial Course with QuickBooks

Daniel J. Siegel

For solo and small firm lawyers, handling finances can be a daunting task. Think about it. You just started your own firm. You have few, if any, clients, and you are using your savings and credit cards to finance the business. Sure, you may, like me, have an accountant who handles your taxes, but because accountants and other financial professionals charge for their time, just as we do, you tend to do anything you can to avoid incurring that expense until tax season rolls around. You could hire a bookkeeper to handle the financial aspects of your firm, but a secretary, paralegal, or even another attorney is more likely to be the first person hired when a solo or small firm attorney decides to take on employees.

Few law schools offer any classes on practice management, and virtually none of these focus on the financial aspects of running a firm. Consequently, many lawyers handle their finances using whatever they may have learned in a college accounting class or by reading magazines like this one. In other words, they handle their financial issues by the seat of their pants. Fortunately, many often use QuickBooks, which, according to many reports, has captured nearly 90 percent of the small business financial accounting software market.

Opting for QuickBooks. What is QuickBooks? Intuit QuickBooks (quickbooks.com) is a double-entry accounting system in which all transactions are recorded as either debits or credits and organized into accounts. Every credit transaction must have a corresponding debit transaction, and every debit must have a corresponding credit. This way, the firm’s books remain in balance.

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