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What is a Monthly 3-Way Trust Account Reconciliation?

A full 3-way reconciliation is required to be completed each month and retained with your other trust account records.  The Client Security auditors will request this document when they audit your trust account.  A template form is available at the end of the Trust Accounts Outline. 

You perform a monthly triple reconciliation in the following manner:

  1. Balance each of the Subaccount Ledgers (client ledgers and also firm funds/ service charge ledger)
  2. Review for - and resolve - any negative balances in the Subaccount Ledgers
  3. Total the Subaccount Ledger balances
  4. Balance the General Ledger a/k/a Check Register
  5. Compute the adjusted bank balance based on bank statement, unprocessed checks
  6. Verify that the [total of subaccount balances] = [general ledger balance] = [adjusted bank balance]

Tip:  A monthly bank statement with check and deposit images is a vital part of the reconciliation process.  If your bank has been providing statements on a quarterly basis instead of monthly, you will need to a) arrange with the bank to receive a monthly statement or b) access monthly statement information electronically.  Similarly, if your bank no longer automatically provides copies of check and deposit images, you will need to a) arrange with the bank to receive the images monthly or b) access and download the images electronically.

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