Tuesday, March 27, 2012

Handling NSF Trust Receipts in PCLaw


There are two main methods used to handle NSF trust receipts:

  1. The NSF is returned by the bank within the trust account. This is a simpler method, but your trust account can end up becoming overdrawn. When using this method, be sure to have overdraft protection in place, to prevent your own trust account cheques from going NSF.
  2. The other approach is to have the bank take the trust NSF funds from your general account. That way, you never have to worry about your trust account being overdraw or NSF trust cheques. You will still want to have overdraft protection on your general account.

If the these trust funds have not been distributed, and you are using Method 1 - simply Void/NSF the trust receipt.

If using Method 2, write a general cheque payable to your bank, enter the matter number, and in the explanation box add a note regarding the trust NSF. Bill the matter, and use the trust funds still on deposit in your trust account to pay this invoice – thereby reimbursing the general account.

When using either approach, problems will arise if the trust funds have already been distributed prior to your being notified of the NSF. If you try to just void the trust receipt, you will probably get a error message that the client’s trust ledger will be overdrawn.

When using either Method, do a General to Trust Transfer in PCLaw and deposit this cheque into your trust account.

If using Method 1, the client ledger will now have sufficient funds, so you can now Void/NSF the original trust receipt.

Using either Method, bill the client, and pay your invoice if there are any trust funds remaining.  The client will now have an accounts receivable balance equal to the funds that were distributed prior to the NSF.

As always, I invite your comments and suggestions for future post topics. Next week – Bank Errors and PCLaw.


Sunday, March 18, 2012

Remnant Invoice Errors in PCLaw


Quite often when making corrections, you receive a message that you cannot change an entry because it has been billed. For example, this happens a lot when dealing with hand-written cheques. When you are doing the bank reconciliation you may find some numbers have been transposed on the entry.

To correct the entry, you need to undo the invoice. But first, you need to remove any payment made on the invoice. Next, Billing – Undo billing – enter the invoice number – hitting tab will populate the matter, etc. - OK.

Before doing the above, either print a copy of the client ledger, or write down the cheque/receipt numbers, invoice number, dates, etc., for reuse when rebuilding the ledger.

You have now undone the invoice, but, when you again try to correct the entry, you still receive the same error message that the entry has been billed. Review the client ledger – Ctrl-L – Matter number - OK. You will find that the invoice number you have just undone still appears one or more times on the ledger. Until these invoice remnants are removed, you cannot change these entries.

To remove, Billing – Bill or Ctrl-B. Enter the matter number and the same invoice number – OK. You will get error message – invoice number already used – YES – reset invoice number - NO. When you get to “Accept or change …” window – OK – then hit cancel. Review the client ledger again, and all traces of the invoice should now be gone.

Correct the entry you started out trying to fix, then redo the billing and payment(s).

As always, I invite your comments and suggestions for future post topics. Next week – Handling NSF Trust Receipts in PCLaw.


Sunday, March 11, 2012

PCLaw and LSUC Lawyer Annual Report


As a lawyer in Ontario, you are required to file your Lawyer Annual Report by March 31, 2012. Failure to file can result in an Administrative Suspension.

If you answer “No” to the question “Do you have a trust account?”, then completing the financial section of the Lawyer Annual Report is relatively quick. However, once you answer “Yes”, the screen suddenly fills with numerous questions that need to be answered, including some math questions.

If you have been following this blog for sometime now, you will know that I have previously mentioned completing a monthly Trust Comparison Report, as is required by Bylaw 9, s.18(8).

And, if you have indeed been completing the required Trust Comparison Report, completing the math section will be a breeze. All you need to do, is transfer the information from the Trust Comparison Report to the Lawyer Annual Report, and you are done the math section.

For a review of Trust Comparison Reports, see – December 5, 2010.


And do not forget to fill out The Law Foundation of Ontario’s Form 1 as well.

As always, I invite your comments and suggestions for future post topics. Next week – Remnant Invoice Errors in PCLaw.


Sunday, March 4, 2012

The Most Common PCLaw Errors – Duplicate Entry Errors


Duplicate Entry Errors occur when you try to alter a previously saved entry. Most often, this occurs when you change an entry from within the Register or Bank Reconciliation windows.

What happens:

- you locate an entry that you need to change

- you open the entry (double click or change button), and make the correction

- when you click OK, you receive an error message: “unable to connect with original entry”

- when you return to the original window (bank rec./register), two entries will now being showing instead of one

Not a big deal if a normal expense entry – like rent – just delete the one you do not want.

However, if this is a client disbursement cheque, with multiple matters, and/or the disbursement been billed, PCLaw will not let you delete the duplicate cheque. You will have to undo the bills, then you can delete the duplicate cheque, then redo the bills. Make sure you keep track of the billing dates and invoice numbers.

As always, I invite your comments and suggestions for future post topics. Next week – LSUC Lawyer Annual Report – Financial Section.