Article ID: 8711

Calculating the Client Disbursement Recovery Balance

PCLaw® calculates the balance for the Client Disbursement Recovery G/L 1210 Account differently depending on the accounting method of your firm.

NOTE:

There is typically not a Client Disbursement Recovery G/L 1210 Account in Cash Accounting. Instead, Cash Accounting typically uses an expense account (5010) to track client costs.

Calculating the Client Disbursement Recovery in Accrual Accounting

PCLaw uses the following formula to calculate the balance of the Client Disbursement Recovery Account in Accrual Accounting:

Unbilled Check/Cheque + Unbilled Recovery - Total General Retainers

Take the following steps to calculate the Client Disbursement Recovery figure using the Client Ledger:

  1. Click Reports, and select Client, and Ledger.
  2. Select or enter 1/1/1982 in the Start Date box and the last day of the fiscal year in the End Date box.
  3. Click to check the Firm Totals Only box.
  4. Click OK.
  5. Take note of the totals on the End Date row of the Unbilled CHE and the Unbilled RECOV columns.
  6. Take note of the total on the General Retainer row.
  7. Add the Unbilled CHE total to the Unbilled RECOV total and then subtract the General Retainer total.
  8. Compare to the Client Disbursement Recovery from the General Ledger Account 1210.
    NOTE: These figures should be the same.

Take the following steps to obtain the Client Disbursement Recovery figure from the General Ledger:

  1. Click G/L, and select G/L Statements.
  2. Click to check the General Ledger box.
  3. Select the Selected radio button under G/L Account Selection and click Select. to open the List G/L Accounts window.
  4. Click to select 1210 Client Disbursement Recovery and then click OK.
  5. Enter the start date and end date of the fiscal year into the date range fields.
  6. Click OK.
  7. Take note of the Client Disbursement Recovery figure found in Balance column and Closing Balance - Client Disbursement Recovery rows.
  8. Compare to the Client Disbursement Recovery calculated from the Client Ledger.
    NOTE: These figures should be the same.

NOTE:

Unused General Retainers appear on the Client Ledger report below the Firm Summary as the General Retainer balance. If you do not see a line for General Retainer, the Unused General Retainer balance is zero.

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Calculating the Client Disbursement Recovery in Modified Cash Accounting

PCLaw uses the following formula to calculate the balance of the Client Disbursement Recovery Account in Modified Cash Accounting:

Unbilled Disbursements + Billed but Unpaid Disbursements - Unused General Retainers

Take the following steps to calculate the Client Disbursement Recovery figure:

  1. Click Reports, and select Client, and then Ledger.
  2. Select or enter 1/1/1982 in the Start Date box and the last day of the fiscal year in the End Date box.
  3. Click to check the Firm Totals Only box.
  4. Click OK.
  5. Take note of the totals on the End Date row of the Unbilled CHE and the Unbilled RECOV columns.
  6. Take note of the total on the General Retainer row.
  7. Add the Unbilled CHE total to the Unbilled RECOV total and then subtract the General Retainer total.
  8. Click Reports, and select Journal, and then Billing (Fees).
  9. Select or enter 1/1/1982 in the Start Date box and the last day of the fiscal year in the End Date box.
  10. Click to check the Firm Totals Only box.
  11. Click OK.
  12. Take note of the Outstanding Disbursements figure found in the Disbs column and Total row.
  13. Add the total Outstanding Disbursement figure from step 12 to the total from step 7 to determine your Client Disbursement Recovery figure.
  14. Compare to the Client Disbursement Recovery from the General Ledger Account 1210.
    NOTE: These figures should be the same.

Take the following steps to obtain the Client Disbursement Recovery figure from the General Ledger:

  1. Click G/L, and select G/L Statements.
  2. Click to check the General Ledger box.
  3. Select the Selected radio button under G/L Account Selection and click Select. to open the List G/L Accounts window.
  4. Click to select 1210 Client Disbursement Recovery and click OK.
  5. Enter the start date and end date of the fiscal year into the date range fields.
  6. Click OK.
  7. Take note of the Client Disbursement Recovery figure found in Balance column and Closing Balance - Client Disbursement Recovery rows.
  8. Compare to the Client Disbursement Recovery calculation from the Client Ledger and Billing Fees Journal.
    NOTE: These figures should be the same. You can find the total Unbilled Disbursement and total Unused General Retainers by running the Client Ledger. Unbilled Disbursements appear in the Unbilled Recoveries section. Unused General Retainers appear on the report below the Firm Summary as the General Retainer balance. If you do not see a line for General Retainer, the Unused General Retainer balance is zero. You can find the Billed but Unpaid Disbursements by running the Billing (Fees) Journal.

NOTE:

Unused General Retainers appear on the Client Ledger report below the Firm Summary as the General Retainer balance. If you do not see a line for General Retainer, the Unused General Retainer balance is zero.

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