Sunday, November 25, 2012

LSUC and Credit Card Receipts

From the LSUC Bookkeeping Guide:
“Any credit card agreement that licensees enter into must provide that all service charges, discounts and other fees payable by the licensee to the financial institution are to be deducted from the licensee’s general account and that no such charges are to be deducted from the trust account.”
The Bookkeeping Guide later states:
“The procedures of some credit card companies place licensees in conflict with provisions in By-Law 9. Some credit card companies require merchants (including lawyers) to designate only one account into which credit card payments are to be deposited. Additionally, the discount charged by the company is automatically debited from this account.

This process will not permit licensees to receive by credit card both retainers and payments for billed fees and/or disbursements. Subsection 2(1) [sic. - 7(1)] of By-Law 9 requires licensees to deposit funds received in trust (e.g. retainers) into an account designated as a trust account. Meanwhile, subsection 8(2) of By-Law 9 prohibits the deposit into trust, funds that are “received by the licensee on account of fees for which a billing has been delivered...” "
The Bookkeeping Guide reaches this conclusion:
“Consequently the use of one account for both purposes is not permissible.”
However, that is not what By-law 9 actually says. In the second paragraph of this section on credit cards, The Bookkeeping Guide correctly states:
“The definition of “money” in By-Law 9 includes “credit card sales slips” and provides that credit card sales slips like other money received into trust, must be deposited to the licensee’s trust account not later than the following banking day.”
With any credit card company, the soonest that funds will be deposited is the next banking day. If you process the client’s credit card for deposit into your general account, and then IMMEDIATELY transfer the same amount to your trust account, you have complied with By-law 9 - “must be deposited to the licensee’s trust account not later than the following banking day.”

Since you have not actually received the credit card funds yet, you are advancing (loan) the funds to your client’s trust ledger. By transferring the funds from general, you have created a general disbursement that will be offset by an equal general receipt when the credit card funds are finally deposited by the bank. If you prefer, you can bill out the general receipt and disbursement on a separate invoice (net $0.00), to avoid confusion on the invoice submitted to the client.

As always, I invite your comments and suggestions for future post topics. Next Posting – Flat Fee Billing vs. PCLaw Disbursements Recovery.


Friday, November 9, 2012

PCLaw and The Conveyancer – Part 2


Part 1 of this article (May 22, 2011) explained how to manually transfer your invoice from Do Process LP’s The Conveyancer® software into LexisNexis Canada’s PCLaw® software in order to complete your bookkeeping records in PCLaw and reconcile your bank accounts.

Part 2 focuses on the new PCLaw Export feature for The Conveyancer, which Do Process released on November 9, 2012.


To use The Conveyancer / PCLaw Export feature, complete the following one-time setup:

1. Tell The Conveyancer where your PCLaw data is stored by entering the path or browsing to the “statdata” directory.

2. Create a directory in which to temporarily store the export data and enter the path to this directory into The Conveyancer. Note: You should set up this directory on your local Desktop or in your My Documents directory. If you set up this directory on a server or a shared directory, your data may be overwritten by another user.

3. Now that The Conveyancer has access to the data in the PCLaw directory, simply match The Conveyancer disbursements with your PCLaw explanation codes and G/L accounts, and define whether these disbursements are subject to HST.

Once you have completed these three steps, your setup is done. Note: If you change your PCLaw codes at a future date, be sure to amend The Conveyancer setup.


To use the PCLaw Export feature, follow these easy steps:

1. Open a new real estate matter in PCLaw.

2. Open a new file in The Conveyancer.

3. Copy and paste the PCLaw matter number into The Conveyancer file.

4. On Tab A, assign the responsible lawyer.

5. Complete the real estate transaction in The Conveyancer.

6. Enter one-off expenses on the fly by adding a new row. Note: Be sure to assign a PCLaw G/L account.

7. Export the fee and disbursement data from The Conveyancer.

8. Import the disbursement data into PCLaw.

9. Import the fee data into PCLaw.

10. Enter a transaction levy in PCLaw if it’s required for this matter.

11. Complete your PCLaw billing and transfer funds from trust to pay your invoice.

The removal of manual entries from this process eliminates any possibility for errors and saves you a great deal of time.

If you wish to complete the paper trail, staple the PCLaw invoice to The Conveyancer invoice.

As always, I invite your comments and suggestions for future post topics. Next Posting – LSUC and Credit Card Receipts.