The best law firm accounting software can handle trust accounting, time tracking, three-way conciliation and legal invoicing from one centralized platform. Features like customer relationship management (CRM), document management and payroll are additional perks that can help firms better manage their practice, but it really comes down to what you want in your accounting software.
Let’s take a look at some of the best accounting software solutions for law firms.
4 Options for the Best Law Firm Accounting Software
1. QuickBooks Online
QuickBooks Online (QBO) is arguably the most well-known accounting software for businesses and for good reason. With QBO, law firms can manage just about all aspects of their operations, including:
- Income and expense tracking
- Legal billing
- Mileage tracking
- Cash flow management
- Receipt capture
QBO’s legal billing complies with American Bar Association and LEDES standards for invoicing clients. Invoices are sent to LEDES billing systems.
With QBO, you can set up recurring transactions in QBO to track regular transactions. And with additional tools from QBO, you can manage payroll, accept payments and more.
One of our favorite things about QBO at Redmond Accounting is it’s ability to integrate with a vast amount of applications, some of which you may already be using. For example, QBO integrates with LeanLaw, Gravity Legal, and Clio.
Many users consider QBO to be the best law firm accounting software (we think so too at Redmond Accounting!). While QuickBooks Online certainly has advantages, it does lack some features, like document management and customer relationship management (CRM).
2. FreshBooks
FreshBooks is another great accounting software option for law firms, and it comes equipped with all of the tools you need to manage your practice, including:
- Legal billing software for professional invoicing
- Tracking billable time with the Time Tracking feature
- Expense tracking and receipt capturing
- Project management
- Client relationship management (CRM) features
- Financial reporting
- Cash flow management
- Document management
- Professional proposals, estimates and e-signatures
FreshBooks offers a robust accounting solution that law firms can use to grow their practices and manage their billable hours with ease.
While FreshBooks has many great features, it is lacking in the reporting department. The goal-setting and metrics features could also be improved, but most firms will find that these features aren’t top priorities.
3. CosmoLex
CosmoLex is more of a legal practice management solution. With this cloud-based platform, law firms can handle:
- Legal accounting
- Emails
- Billing
- Document management
- Time tracking
But here’s what really sets CosmoLex apart:
- LEDES billing
- Trust accounting
- Built-in client portal
- Matter management
- LawPay integration
With CosmoLex, firms can easily manage their items related to cases, matters and events. Each billable item, document and task will be tagged with the appropriate client. Firms can create timecards, trust transactions, invoices and more right through the platform.
Additional features, like CRM, calendar management and the client portal, make this platform worth considering for growing firms.
Just be mindful that CosmoLex does not have an integrated payroll system and you can’t create invoices from scratch (time/expense cards need to be used).
4. PCLaw
PCLaw is a legal practice management solution that’s desktop based. It offers integrated legal trust accounting and billing, and is designed to serve as an all-in-one solution for firms. And if you want to take this software to the cloud, you can do so through private hosting.
PCLaw is considered one of the top billing and accounting software for law firms because it was built with law firms in mind.
With PCLaw, firms can:
- Manage legal matters
- Reconcile trust accounts
- Track time
- Manage client relationships
The biggest advantage of using PCLaw is that it offers both trust accounting and matter management in one place.
The software also supports LEDES files, which is the standard legal billing format. The time tracking feature, called Time Matters, is from LexisNexis and includes basic document management and billing capabilities.
While PCLaw has many great advantages, it’s lacking in the payroll management department and reporting can be complicated. Lack of transparency with pricing is also a concern. Firms have to contact the company for a quote.
Which One is Right for Your Law Firm?
Accounting software, like the ones listed above, often offer free trials that allow you to take the solution for a test drive and see if it’s the right one for your firm. Take advantage of this opportunity and weigh the pros and cons of each one you try.
As we said above, at Redmond Accounting, we believe QuickBooks Online is the best accounting software for law firms which is why it’s the only one we use with all of our clients. To explore if QuickBooks Online is right for your firm or to learn how we can help you with your accounting needs, schedule a consultation now!
