Day 1

Leo Cussen Centre for Law

Practical Training Course

Accounts

Exercise 6A: Answer

Trust Account Reconciliation

Reconciliation for month ending 31 March 20 XY
Date Statement Prepared 31 March 20 XY
PREPARED BY ............................................ AUTHORISED BY ..........................................
n CASH RECONCILIATION
Cash Book balance from previous month $ 750.00
ADD Total Receipts $ 69,153.46

SUB TOTAL $ 69,903.46

DEDUCT Total Payments $ 46,582.00
Cash Book Balance at end of month * $ 23,321.46
n BANK RECONCILIATION
Balance as per Bank Statement $ 23,753.46
ADD Deposits not credited $ NIL
ADD Funds with SDA $ NIL
SUB TOTAL $ 23,753.46

DEDUCT Unpresented cheques $ 432.00

$ 23,321.46
Balance as per Bank Account * $ 23,321.46
Unpresented Cheques

Date Payee Cheque No. Amount

28/3/XY Family Court 210 900 $ 432.00

of Australia
$ 432.00

n LEDGER RECONCILIATION
Client File No. Sort Date of Last Amount Remaining
Description of Matter Movement In Account
Rogers 148/XY Dangerous Driving 27/2/XY 750.00
Grant 157/XY Diss. of marriage 28/3/XY 68.00
Diamond 125/XY Conveyance / Sale 19/3/XY 22,503.46

* These totals should agree TOTAL *$ 23,321.46

List of controlled money accounts Reg 3.3.26(8). No controlled money accounts are
maintained by the firm.
 Leo Cussen Centre for Law
Practical Training Course

Accounts

Exercise 6A

Trust Account Reconciliation: Additional Notes

(a) The balance carried forward for February is $750.00. The bank statement shows
$1,000, but this is because there is an unpresented cheque in February for $250.00.

(b) There are no funds deposited with the Statutory Deposit Account.

(c) The February cheque for $250.00 is presented in March, so it is no longer listed on the
reconciliation as unpresented.

(d) Cheque no. 210900 for $432 is issued on the 28/3/XY and is included in the trust cash
payments. This cheque has not been presented to the Bank and so is shown on the
March reconciliation as an unpresented cheque.

(e) The Ledger Reconciliation lists the clients for which funds are held as at the end of
March. In addition, the law practices should look at the amount held, and check
whether or not the funds should have been disbursed, or whether the balances have
not moved for a number of months – and if so, why.

In Rogers the money is part of the balance received at settlement in a conveyance. It

probably represents costs which cannot be taken till the file is completed. The file
should be checked, and if it is complete and the money is for costs they should be paid
out to the law practices.

In Grant, the $68.00 is the difference between the $432 filing fee and the $500
received on account of costs and disbursements. The file should be checked to see if
any costs have been incurred on behalf of the client by the law practices which can be
reimbursed to the law practices out of the funds in trust.

In Diamond, the $22,503.46 represents the balance of deposit received which must be
held in trust till settlement.

NOTE: in some instances, the law practices will act as stakeholder and must hold such
deposits in the name of both the vendor and the purchaser.