The Best Law Firm Accounting Software for 2022
Accounting is a vital element of any business, including law firms. However, by their nature, law firms have unique needs that need to be met when it comes to accounting. Most law firms need:
- General accounting
- IOLTA accounting
- Multiple billing types
- Cash Basis (vs. Accrual)
- Law firm-centric financial reporting
Law firm accounting software makes the billing and invoicing process easier to manage. It also allows law firms to efficiently manage their cash flow and resolve any financial issues before they spiral out of control. Legal accounting software helps firms stay compliant with laws set by the government authorities to protect sensitive client data.
Today, with many legal accounting software tools available, it is not easy to choose the best one. In this article, we’ll look at the different types of law firm accounting software, law accounting software features to consider, and our list of the best accounting software for law firms going into 2022.
Let’s get started.
The Types of Accounting Software
There is general-purpose accounting software meant to be used by any business but does not necessarily feature crucial law-firm-centric functions that you may need.
To provide clarity, in our list of the best law firm accounting software, we’ll define each software product as one of three classes:
- Pure accounting software
- Practice management + accounting software
- Dedicated legal accounting software
As a first step towards finding the right law firm accounting software for your firm, consider whether you want accounting functions built into your law practice management software or if you prefer to keep accounting and case management functions primarily separate.
Law Firm Accounting Software Features to Look For
It is crucial to inventory the specific capabilities and features you require in your law firm accounting software. For this, you should confer with both your legal team and your accountant. Here are some common features that come with most law firm accounting software.
Time tracking
Most law offices bill hourly, so the capacity to follow the time spent on undertakings and billing on time is essential. This element regularly incorporates flat fee, task-based, contingency billing, split, and retainer charges.
Additionally, it incorporates stopwatch timers, which are set up to record billable time dependent on the fee arrangement between the firm and its clients. A few frameworks can pull information from other applications, for example, schedules to account for the full billable time.
Billing and invoicing
Craft invoices using the billable time logged by lawyers. The system can send invoices through the mail or electronically over email and pay using Visa, electronic funds transfer, or another secure payment method.
Customization choices permit law offices to customize invoices with the law firm’s logo and customer data. A few frameworks can be set up to caution firms and customers when bills are past due and accurately compute a late fee to add to the receipt.
Contact & client management
Since customer relationships are significant, a quality law firm accounting software will contain contact management capabilities, recording data for customers and related parties. This feature is also referred to as legal customer relationship management (CRM).
Project scheduling
This feature helps manage your caseload by storing deadlines, events, records, notes, things to do, billing, and payments. It helps synchronize your schedule with email, create tasks, set reminders, and view scheduling conflicts directly.
Client portal
Some legal accounting software tools incorporate a customer entryway, which permits customers to safely submit documents and securely pay for services they have received.
Other features
Other features that are often, but not always, available in law firm accounting software include:
- Credit Card Management
- Loan Management
- Expense Tracking
- Asset Management
- Online Banking Integration
- Profit & Loss Statement
- Cashflow Statement
- Tax Reporting
- Bank Account Reconciliation
The Top Five Accounting Software for Law Firms
#1. QuickBooks
Intuit’s QuickBooks is the most popular legal accounting software. And for a good reason, it’s robust, powerful, yet still user-friendly. QuickBooks is not designed exclusively for law firm accounting, so while a great software tool, it may lack some of the legal-specific features your practice needs.
QuickBooks comes in both a Desktop and a Cloud-based version. The former is the classic, full-featured accounting software that runs on Windows. The latter is Intuit’s cloud-based edition which provides much of the traditional Desktop functionality.
Features
- Easy to use user interface even for non-accountants
- Easy for an outsourced accountant to access
- Has a desktop and cloud-based version
Price
- QuickBooks Desktop: From $199 per year
- QuickBooks Online: From $40 per user per month
#2. FreshBooks
FreshBooks offers a well-rounded, intuitive, and attractive double-entry accounting experience supporting invoices, estimates, expenses, time tracking, and projects. FreshBooks allows you to track total costs, see reports and receive payment in credit cards and bank transfers.
Features
- Detailed client records
- Delightful user experience
- Team collaboration and time tracking tools
Price
Starts at $13.50 per month.
#3. ProLaw
ProLaw is a solid legal software platform that incorporates the three main pillars of a law firm: practice management, document management, and accounting software.
ProLaw comes in several packages and editions, some of which include ProLaw’s fully-featured accounting software. ProLaw enables you to efficiently manage clients, documents, billing, and accounting on a single package.
Features
- Sleek user interface
- End-to-end solution
- Excellent integration capabilities with MS Office
Price
- Price varies depending on the firm
- Starts at a 10-user package
#4. Xero
Xero is an online accounting software platform designed to simplify accounting tasks such as paying bills, managing expense claims, creating invoices, and more. Xero’s central hub is accessible online and used to work staff and client data.
Features
- Easily accessible from any remote so long as there is an internet
- Automatically imports bank transactions
- Has an app for Android and iOS
Price
- Early: $5.50/month
- Growing: $16/month
- Established: $31/month
#5. Juris
Juris is a robust law firm billing and accounting platform. It’s compelling and flexible, making it a top choice for law firms with ten or more time-keepers. Juris gives you full-fledged accounting features such as detailed billing for various billing models.
Juris comes in two packages: Juris Core and Juris Suite. Juris Core is the entry-level version, while Juris Suite is the more comprehensive edition. Both come with rich accounting and a robust set of financial and billing reports.
Features
- Rich accounting feature set
- Solid billing system with flexible options
- Integration with Time Matters
Price
Depends on users and edition
The Bottom Line
Cloud-based solutions are an outreach to most midsize firms due to their high cost. Using online legal accounting software is transformational as it will save you the money you’d have spent on server upkeep.
At Rea & Associates, we provide complete IT services and IT solutions for organizations throughout Northeastern Ohio. We love the difference it makes in our client’s everyday experiences. Contact us, and we will help your law firm set up efficient accounting software.
