CPA Firm Serving PA, NJ, NY, & DE

Legal Accountant in North Philadelphia

At SD Associates, P.C, we have a team of skilled accounting professionals who offer full-service legal accounting in North Philadelphia. Our firm is dedicated to providing services that cater to your unique needs and preferences. We specialize in various areas, such as tax planning and preparation, financial statements, and consultation services. Our commitment to quality service ensures that we exceed our clients’ expectations.

Law firms know they can trust us to provide the highest level of financial management support and guidance. Whether you’re an individual requiring tax help, a corporation with financial statements to file, or a law firm looking for assistance with accounting, SD Associates, P.C is here to help.

Common Legal Accounting Mistakes

Mishandling trust accounts: The management of trust accounts is a critical component of legal accounting. Failure to do so can lead to significant consequences, including heavy fines.

Failing to keep detailed records: In legal accounting, maintaining proper documentation is imperative. Neglecting to document transactions, accurately categorize expenses, and maintain current records can result in substantial compliance issues.

Not being aware of applicable laws: Legal accounting rules and regulations vary by state. Attorneys must acquaint themselves with the legislation of the state in which they practice. Failure to do so may lead to a breach of regulations associated with the practice of law.

Incorrectly identifying income as revenue and vice versa: In accounting, the terms “income” and “revenue” are often used interchangeably, leading to confusion. However, in legal accounting, it is crucial for attorneys to understand the difference between these two concepts.

Entering data incorrectly: In legal accounting, even minor errors in data input can result in significant mistakes. Therefore, attorneys must scrutinize every transaction to detect discrepancies.

Avoiding professional assistance: In the intricate area of legal accounting, experienced legal accountants may give vital insight. Attorneys who neglect to seek assistance may be penalized because they are unaware of critical rules or regulations.

Trust Accounting

To keep client cash separate from the firm’s finances, law firms and accountants use trust accounting. Settlement monies, court fees, advanced charges, and retainer fees are all examples of these funds. It is vital to correctly manage trust accounts because they prevent the mixing of client and corporate cash. Financial mismanagement and a lack of responsibility can result from improper handling.

At SD Associates, P.C., we understand the importance of trust accounting services. We offer comprehensive solutions to ensure that account activity is handled according to industry best practices. Our team has years of experience providing reliable guidance, and we take great care in recording all transactions.

IOLTA Account Management

The IOLTA is an account created exclusively for lawyers, serving as a financial instrument. Its primary purpose is to separate trust funds from operating funds, providing the means to manage client funds obtained on their behalf.

At SD Associates, P.C., we offer comprehensive IOLTA account management services for law firms of all sizes. Our North Philadelphia legal accountant will work with you to ensure that your IOLTA accounts are properly managed. We provide comprehensive reports outlining activity within each client’s IOLTA account so that you can have peace of mind.

Legal Bookkeeping and Accounting Solutions

SD Associates, P.C. offers complete bookkeeping and accounting solutions to legal firms. Our team of proficient experts has a wealth of experience in financial record-keeping, cash flow projections, report generation, and client payment collection. We recognize that legal organizations have distinct requirements that necessitate specialized care. That’s why we take the time to comprehend each client’s operations and tailor our services to meet their specific needs.

Legal Accounting FAQs

Does the legal structure of my law firm have an impact on my taxes?

Depending on the legal structure of your law firm, there may be different tax requirements. For example, a partnership, limited partnership or LLC may be subject to different tax requirements than a sole proprietorship. Our North Philadelphia legal accountant can help you understand how your firm’s legal structure affects your taxes and provide advice on the most beneficial taxation options for your specific situation.

What should I do if I am being audited?

If you are being audited, it is important to seek professional advice from a qualified legal accountant. We can provide comprehensive assistance with resolving tax compliance issues, including an audit. We have extensive experience in dealing with IRS and state agencies and can help ensure that the process goes as smoothly as possible.

Does GAAP apply to law firms?

Privately-held companies are not required to disclose their financial information. However, adhering to GAAP (Generally Accepted Accounting Principles) is generally recommended in order to maintain accurate and consistent financial information. Our team at SD Associates, P.C., can provide guidance on how to apply GAAP principles to your law firm’s accounting system.

Contact Our Legal Accountant in North Philadelphia Today

At SD Associates, P.C., we understand the significance of your law firm’s finances, and we appreciate that they necessitate professional handling. To that end, our experienced North Philadelphia legal accountant can offer you comprehensive advice on a wide range of financial matters, including trust accounts, bookkeeping, taxes, and more. To learn about our legal accounting services and book a consultation for your business, call us today at (215) 517-5600.