Reconciling legal trust investment account

Discussion in 'Business Accounting, Tax & Legal' started by Cath9, 9th Mar, 2018.

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  1. Cath9

    Cath9 New Member

    9th Mar, 2018

    I work for a small legal firm and I am responsible for their trust reconciliations. I am fine with the general trust reconciliation but they also have a few term deposit investments held on behalf of trust clients. The funds move from the general trust account to the term deposit and vice versa.

    However at the end of every month I would like to be able to confirm the investment balances against a bank balance. However I am told this is not possible for the bank to provide and it is sufficient that only the general trust account is balanced to a bank statement as any money moving from the investments will go through the general trust account.

    However there have been instances where cheque payments have been made out of the general trust account to set up these investments but due to a lack of paperwork/limited detail on cheque butt, it was not known that it was to set up a trust investment and hence not shown in the trust reconciliation for some months.

    In my opinion seeing a confirmed bank balance would also ensure that the investment money is still held by the bank at the reconciliation date (it could be possible someone hacks the account or removed the money some other way?)

    Can anyone offer any advice how they tackle this problem or should I just accept that the investment account is fully reconciled by the reconciliation of the general trust account alone?