Year-End Cleanup: A 30-Day Plan for Law Firms

Year-end can be stressful for law firms. Between client demands, tax prep, and looming audits, it’s easy for bookkeeping to fall behind. But closing out the year doesn’t have to feel overwhelming. With a structured 30-day plan, you can clean up your books, reconcile trust accounts, and start the new year on solid footing.

Here’s how to make it happen in four focused weeks.

Week 1: Reconcile Accounts

Begin with the foundation: reconciliations.

• Review bank and credit card accounts to ensure they’re reconciled through the most recent month.

  
  

• Perform a three-way reconciliation for your IOLTA account (bank balance, general ledger, and client ledgers must match).

  
  

• Investigate and resolve any variances.

  
  

Pro Tip: Document everything. Having signed reconciliation reports on file makes audits much easier.

Week 2: Clean Up Client Costs and AR

Unrecovered client costs and overdue receivables can drag down profits.

• Review your advanced client costs ledger. Make sure costs are billed back to clients instead of left in firm expenses.

  
  

• Audit your accounts receivable. Identify balances over 90 days and develop a plan for collection or write-off.

  
  

• Confirm that any trust advances for client expenses are correctly applied.

  
  

Week 3: Organize Documentation

Compliance and tax prep both require strong documentation.

• File all bank statements, client ledgers, and reconciliation reports for the year.

  
  

• Organize vendor invoices and expense receipts.

  
  

• Ensure trust account records are clearly separated from operating account files.

Week 4: Run Reports and Plan Ahead

With reconciliations and documentation complete, wrap up with reporting and strategy.

• Run year-end profit & loss, balance sheet, and trust reports.

  
  

• Review key KPIs: utilization, realization, AR days, and WIP.

  
  

• Meet with your CPA or advisor to plan for tax payments and Q1 cash flow.

  
  

Closing Year-end cleanup is about more than compliance — it’s about clarity. By following a 30-day plan, your firm enters the new year with clean books, audit-ready trust accounts, and financial confidence.

👉 Want expert help with year-end cleanup? Medley Business Advisors specializes in helping law firms close strong and start fresh.

Craig Medley, QBO ProAdvisor

Founder, Medley Business Advisors, LLC

Bookkeeping & Advisory for Law Firms

📧 Email: craigmedley@medleybusinessadvisors.com

 🌐 Website: medleybusinessadvisors.com

 📞 Phone: 443-822-2284