I.  General Bank Account

When a firm is first opening a pooled trust account, a general bank account will also need to be opened. A general bank account is needed because it is used for depositing money related to the practice of law that is not trust money and for paying business expenses such as rent, staff salaries, etc. All of the bills associated with the operation of the practice are paid from the general bank account. Although you don’t have to, many members choose to use the same savings institution for their general bank account as they do for their trust bank account.

It is basically the member’s business account. Once you have rendered legal services to your client and delivered a bill (a statement of account) to the client, payments of that statement of account are deposited into your general bank account.

PRACTICE TIP

From a practical perspective, it is a good idea to order different coloured cheques for the general bank account and trust bank account.  This helps reduce the chance of error when writing cheques – less possibility of writing a trust cheque on general bank account cheque stock, or vice versa.