The cash disbursement journal includes the check numbers for all checks that were written during the previous month, which has led many accounting software packages to refer to the journal as a check register. These packages either have preset forms for the cash disbursements journal, or easily customizable forms to accommodate business needs. Your cash disbursement journal can provide an up-to-date snapshot of these cash payments during a specific time period (e.g., quarter or year). Missing a journal entry can throw off your running balance and cause you to misread your financial health.
Double Entry Bookkeeping is here to provide you with free online information to help you learn and understand bookkeeping and introductory accounting. This article will tell you what you need to know about keeping a cash disbursement journal, and how to create your own. Each of these columns is then added up at the end of the journaling period to arrive at a total sum. It can also be a good source of information regarding individual payment transactions.
Cash Disbursement Journal
The second cardinal rule is that lawyers may not deposit their own personal or business funds in their escrow or trust accounts. The one limited exception is that a lawyer may deposit funds “reasonably sufficient” to cover the fees or charges imposed by the depository bank holding the escrow funds. [DR 9-102(b) (3), 22 NYCRR §1200.46(b) (3).] A lawyer who uses his escrow account for the deposit of his personal funds faces serious disciplinary sanctions.
It provides a clear picture of the company’s cash flow status, which is especially important for small businesses that should closely monitor operating costs. To use a cash payment journal, businesses must first set up the journal in their accounting software. Once the journal is set up, businesses will enter each cash payment into the journal as it occurs.
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the attorney trust account. Record all details for all journal entries in the cash disbursements journal, such as the payee’s name, the purpose of payment, and any additional notes or comments. It will ensure accurate record-keeping and simplify analyzing the company’s cash flow. For example, suppose a business pays an amount exceeding the charges for a service and later gets a refund for the excess money paid.
The minor infractions discovered as a result of such investigations typically result in a warning or low-level private discipline. Sadly, as the investigations following bounced check reports demonstrate, too many experienced lawyers are still unfamiliar with the rules on escrow accounts and record-keeping. Many believe that if they don’t “steal” their clients’ funds, they are not at risk. Many lawyers in law firms believe that because someone else is responsible for managing the firm’s trust accounts, they themselves are not at risk. Others believe that only dishonest lawyers are disciplined for escrow-account violations.