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July/August 2020


Taking a Look at Your Bookkeeper’s Position Description

Peter Roberts

First, I hope bookkeeping is not in your position description. Yes, you need to know the basics of the bookkeeping function, and your CPA is a good source for a quick overview of what is involved. But I want you to practice law, not do the bookkeeping. I think I just heard a roar of agreement!

The Person

How to find a bookkeeper familiar with law firms? Your state or local bar association may offer a practice management service. The person performing this service is known as a practice management advisor or PMA. Ask whether they have a list of bookkeepers familiar with law practices, particularly the trust accounting part. If not, a web search or asking other attorneys will turn up some names. I think a bookkeeper’s personality is a factor for whom to choose. A bookkeeper’s personality should be open, pleasant and not defensive or secretive. This means a bookkeeper will be willing to explain and share information in a helpful fashion at any time. But again, knowledge of the law firm trust account rules is essential. In Washington, the state bar offers an excellent booklet describing the trust account rules and bookkeeping methods with illustrated examples. So, check for this resource with your own state bar association. Another good but little-known resource for financial information is the IRS Attorneys Audit Technique Guide.

The Position

A position description includes the broader responsibilities and important duties. Responsibilities include preparing the annual budget and producing monthly financial reports. Another responsibility might be to perform certain financial analyses. For example, if your firm or a partner owns the building you are in or other real estate, there may be a need for your bookkeeper to attend to the bookkeeping associated with any sub-tenantsor properties.

Duties include the bookkeeping entries, balancing of accounts, reconciliation of bank accounts, preparing accounts payable payments, processing accounts receivable payments, preparing payroll and any quality control tasks. The number of staff necessary for these tasks depends on the size of your firm and the number of transactions. Transactions is a global term for the repetitive need for checks, deposits, bookkeeping entries, etc. If your firm is growing, be mindful of the effect of the growth in new clients and/or new attorneys on your bookkeeper. Are you noticing a recent uptick of overtime pay for your bookkeeper?

Be sure your bookkeeper understands the chart of accounts for the firm because he or she likely was not involved in setting that up. Each income statement account and balance sheet account should have a meaningful name and receive a consistent flow of properly identified transactions. That will instill confidence that the totals reflect the proper types of costs in line with the names of the accounts. Your bookkeeper will benefit from reading The Lawyer’s Guide to Increasing Revenue (Third Ed.) from the ABA. It includes a chapter devoted to the bookkeeper and the role of the managing partner as well as a copious list of helpful appendices.

The Leadership

As I have said in prior finance columns, I usually do not see a small firm using a budget. In my opinion, a budget is a fundamental tool of control. Your bookkeeper is the one to lead the charge for a budget each year, not you. A shortcut method to set up a budget is to use the amounts from last year and make adjustments to the accounts as necessary. The task should take no longer than an hour or two.

Another responsibility of the bookkeeper is preparing the monthly financial reports. These reports include both timekeeper-related information and firm-wide information. I know what you are thinking: “I wonder what reports my financial software can produce.” Law firm financial software has come a long way in recent years with the number of reports and customizations that are now possible. Your bookkeeper should possess keen curiosity about what reports are available from the software. But I am not talking about data reports. Data reports spill reams of numbers that identify transactions. You need to be receiving the summary reports the software can produce.

I hope your bookkeeper also has a good command of spreadsheet software to allow for specialized reports. If your bookkeeper is producing charts, I want to hire that person. You have a valuable employee.

Be sure to support the continuing education of your bookkeeper. The vendor of your financial software may offer these opportunities. I also highly recommend your bookkeeper join the Association of Legal Administrators ( This organization will facilitate your bookkeeper connecting with other bookkeepers in similar-sized firms to allow the answering of questions about bookkeeping and the software.

One report that your software may not be able to produce is the pipeline report. This report describes the flow of revenue. To produce the pipeline report, use a spreadsheet to list the partners or responsible attorneys in a vertical column. To the right of the names insert four columns: Fees Worked, Fees Billed, Fees Collected and Realization (Fees Worked divided by Fees Collected). To the left of the names insert the same information for last year. All the data is on a year-to-date basis. The realization percentage should be above 90 percent.

Your Role

Calendar a regular meeting with your bookkeeper each month. Said another way, avoid a hands-off supervisory style. I know you’d rather practice law, but such meetings with your bookkeeper send the message of your interest in the hard work performed by that person. You do not want to take that effort for granted. If your financial reports are set up correctly, these meetings should not require more than 30 minutes.

And Another Thing …

Remember that your financial reports support the partner compensation system in your firm. Each partner should feel more than comfortable with the reports used and understand how these reports are produced. Your bookkeeper should at any time feel comfortable discussing any of the numbers with any partner.

Peter Roberts


Peter Roberts is a private practice management consultant for lawyers. He was the former practice management advisor in the Law Office Management Assistance Program of the Washington State Bar Association for 13 years. He is active in the ABA Law Practice Division and is serving as the 2019-2020 chair of the Law Firm Finance Committee.