The Florida Bar’s Practice Resource Center

Law firms can now get expert financial guidance without hiring a full-time chief financial officer by using contract CFO services. These services help firms save money and provide crucial insights needed to make smart business decisions and grow. Legal practices find CFO services valuable because they create flexible forecasts using non-financial indicators.

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• If cash flow is unpredictable, it’s harder to plan for growth, cover expenses, or even pay yourself consistently.
• As part of the Clio ecosystem, it integrates with Clio Manage, allowing firms to track billable hours, generate invoices, and handle trust accounts all in one place.
• Bill4Time also alerts you to unbilled time and missed entries, protecting your firm’s revenue.
• An IOLTA account is a specific type of trust account where lawyers hold small or short-term client funds.
• If you already have accounting software in place, it may be time to review it.
• The use of a trusted specialist in law firm accounting gives you the peace of mind of knowing that transactions will be recorded in the appropriate accounts with detailed, accurate descriptions.

Benchmarking can also help you evaluate your firm’s workflow, operating costs, pricing model, and the competitiveness of your compensation programs. Every transaction in and out of these accounts must be properly recorded and documented. Mishandling trust/IOLTA accounts or reporting them incorrectly can lead to serious repercussions, including penalties, suspensions, and even disbarment. We can help you maintain an accurate client trust ledger, track client-related costs, reconcile account balances, and generate trust/IOLTA accounting reports that comply with the rules in your state. Law firm accounting requires an in-depth understanding of how to manage funds held on behalf of clients in trust or IOLTA accounts.

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We can help manage the financial side of your firm, allowing you to focus on practicing law and building your book of business. The American Bar Association (ABA) reports that there are currently more than 1.3 million active attorneys practicing law in the United States. The vast majority of U.S. legal services are provided by solo practitioners and small firms with fewer than 30 attorneys. This means your firm likely has a lot of competition.In recent years, clients generally have conceded to paying their attorneys higher billing rates, helping firms absorb rising operating costs.

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Legal accounting software takes those tedious tasks off your plate. It automatically tracks expenses, syncs with your bank for easy reconciliations, and organizes tax records without the last-minute scramble (and that’s just the tip of the iceberg). With everything in sync, billing runs smoother, financial reporting capabilities improve, and client management stays organized. Rather than wrestling with spreadsheets, you get a clear, accurate view of your firm’s finances—without the extra hassle. Legal accounting software helps prevent these slip-ups by automating calculations, tracking every transaction, and flagging inconsistencies before they turn into real problems.

405-2 Cost-plus-award-fee contracts.

Unlike generic accounting platforms, legal accounting software includes features that help law firms meet compliance requirements set by the American Bar Association (ABA) and local jurisdictions. Our 2025 Legal Industry Report found that Bookkeeping for Law Firms 43% of law firms saved up to 10 hours using legal-specific accounting software. Although it’s not built specifically for law firms, its easy-to-use interface and automation features make financial management less time-consuming. It’s a good option for firms that don’t require complex trust accounting but need an efficient way to handle billing and expenses. Legal accounting software helps firms handle client funds properly, generate accurate invoices, and keep financial records organized without extra manual work.

Small law firms must track client funds, manage billing, and follow trust rules with care. The best accounting software for small law firms makes work simple, saves hours, and keeps records accurate. It helps firms manage trust accounts, create clear reports, and stay compliant with legal and tax laws. In 2025, many tools will be built for legal use with strong features for billing and reporting. This guide lists the 10 best accounting software for small law firms in 2025 to help you choose the best system for smooth and secure financial control. Choosing the best accounting software for law firms depends on your practice’s size, specialties, and specific requirements.