1. Required Records
There are two main accounting record requirements for your general account; a general book of original entry and an accounts receivable ledger. There is also a requirement that you keep all supporting records for the account, which includes bank statements, deposit slips, statements of account and similar documents.
a) Book(s) of Original Entry
The book of original entry for your general account has a number of the same requirements as a trust account book of original entry. It can be electronic or paper. There is no prescribed form for a book of original entry for general or trust accounts.
- the book of original entry must contain the full details of all transactions entered into it;
- you must record the ‘form’ of receipt (cash, cheque, e-transfer, wire transfer, etc.);
- every time you have a transaction, you must record it right away on that date; and
- you cannot backdate or make changes in entries once they are made. If you have to correct an entry, you must make a new entry or entries to correct the original entry and you must date the new entry or entries with the current date. Ink must be used if it is a hand written book of original entry.
b) Accounts Receivable Ledger
When you complete work and provide your client with a statement of account, and there is any amount owing to you, even if there is a plan that the client will make regular payments over time on the account, this creates a receivable for your law firm.
You are required to record receivables on a systematic basis, tracking the amount of the statement of account, any payment(s) made so far on it, and the remaining balance.