Paul W. Carlson, CPA (00:00):
Hi, this is Paul Carlson CPA with Law Firm Velocity. In this video we're going to talk about making aggregate IOLTA trust account draws. So what am I talking about here? Within Clio, we have made invoices and we have made four trust account draws. So we have our four draws here dated September 20th. We have a couple options when actually going to the bank to make these draws. So the first and most conservative approach is to go to the bank and write a separate check for each draw or to do a separate EFT transfer for each draw, that provides the cleanest audit trail and it's probably the most conservative approach. This process falls apart with busy firms, especially with family law firms that are doing 20 to 30 trust draws several times a month. Doing that many checks or that many draws is just too much effort. So in that case, what you can do is you can add up the amount of these four individual draws and do one aggregate transfer or one aggregate check for the total amount.
Before we go too much further, if you don't have a super solid control over your trust account, don't do aggregate draws. When we do cleanup for firms, if they've done aggregate draws and they haven't had a super picky accountant going through and making sure everything is squeaky clean, aggregate draws just turn into a complete disaster. So if you're not looking at a 20 to 30 page IOLTA reconciliation report every month with an accountant telling you something is a penny off every couple months and having you make the adjustment so it's perfect, don't do this.
So with that warning, to actually make the aggregate draws, what we do within Clio is we go over to reports, we need this bank account activity report. And from that report, we want to run a report from the Bank of America IOLTA account, or wherever your IOLTA account is. Custom dates for that one date and we want to kick the report out into a CSV, and so that will open in Excel.
So after a little massaging, Excel will look like this. So this is just a list of our IOLTA draws then what you want to do is you want to go in here, highlight our draws, click auto sum, and now we can go to the bank and do our draw for $4,661. The most important step of this is we want to save this file and save it for archiving. And if we're helping with your firm's accounting, please email this file to us. What we will do is we keep this for future reference, just on the odd case that someone goes in and changes one of these detailed draws. So when we look at Clio in the future, these draws won't tie to the exact transfer amount. We need this report so we know how this initial transfer was calculated. So we can go back in and try to make revisions or make the alter reconciliation tie out. So again, the key steps of this is to get this report, save it, aand then archive it for accounting.
The other nice piece is by doing this aggregate calculation here, you get a really quick total that otherwise in Clio there'll be 20 different transactions and you're trying to add those up on your calculator and that usually doesn't work out so hot.
And with that, that's our suggested process for making aggregate trust account draws from Clio.