If your law firm holds client money in trust, the Law Society of BC has firm rules on how it is recorded, reconciled and reported. Here is what to have in place.
What do the Law Society rules actually require?
The Law Society Rules, including Rules 3-67, 3-68, 3-69 and 3-75, set out the trust and general account records every law firm must keep. Firms must be able to produce those records on demand under Rule 10-3, so organized, current books matter more than printed binders.
How often do trust accounts need to be reconciled?
Trust accounts need to be reconciled every month. Missing monthly reconciliations are an exception that must be disclosed on the annual Trust Report, and they are one of the first things a reviewer looks for.
When can fees be paid out of trust?
Trust cheques that pay fees should be signed and dated on or after the date the invoice is prepared and delivered to the client (Rules 3-64 and 3-65).
What if there is a trust shortage?
A trust shortage of more than $2,500, or any inability to deliver up trust funds when due, must be reported to the Law Society in writing immediately.
Can the Law Society audit my firm?
Every BC law firm can be selected for a Law Society compliance audit under Rule 3-85. Filing the annual Trust Report does not replace an audit.
A simple monthly checklist
- Reconcile each trust account and the general account
- Review client trust ledgers for unusual or negative balances
- Confirm an invoice exists before fees are paid from trust
- Keep records ready to produce on request
How HJ Wu & Company Inc. helps
The Vancouver CPA firm handles this work every day. See law firm accounting or contact the firm to book a consultation.
Official sources
- Law Society of BC: trust reports
- Law Society of BC: reporting trust shortages
- Law Society of BC: compliance audit FAQs
Reviewed October 30, 2026. This is general information, not legal or tax advice. Rules and rates change, so confirm current requirements with the official sources above and speak to a CPA about your situation.
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HJ Wu & Company Inc. offers law firm accounting that covers everyday bookkeeping, financial statements, tax filings and trust account work, using the software your firm already runs. The team understands the fiduciary side of legal practice and keeps client records secure. If you want an accountant who already knows how law firms work, contact HJ Wu & Company Inc.
A Trust Accountant's Report is a review of how a law firm handles client money held in trust, such as retainers, to confirm it follows Law Society of BC accounting rules. HJ Wu & Company Inc. has experience with trust accounting for BC legal professionals, including trust reporting and reconciliation. Not sure where your firm stands? Reach out and HJ Wu & Company Inc. can walk you through it.
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