Clio Accounting: Banking

Banking and bank feed matching (reviewing and matching transactions) is an important workflow in Clio Accounting. This is where you will match transactions that appear on your bank account statement to the data in your accounting solution (i.e. reviewing what is on your books). Maintaining an accurate bank feed helps you stay on top of your books and is also an integral part of reconciling your operating and trust accounts. 

Connect bank accounts

If you went through the setup wizard when you first launched Clio Accounting, your bank accounts (along with your ledger accounts in your chart of accounts) should already be set up. If you did not proceed through the setup wizard or if you need to add an additional account at a later time, connecting an additional bank account is simple. Once connected and fully set up, transactions will sync almost instantly from your bank to Clio Accounting. We recommend connecting all your operating, trust, and credit card accounts in your chart of accounts to your bank accounts. 

1. Go to Banking and click Connect bank account.
2. Follow Plaid's prompts and enter your online banking credentials to connect your bank account.
3. Click Continue on the last Plaid screen. Once your bank account is connected, you need to link at least one ledger account within your chart of accounts to the connected bank account. 
   • If you skip this step, you will not be able to use the automatic bank feed feature. You can finish setting up and linking to a general ledger account at a later time by going to the connected account in the Banking tab and then clicking Link to a general ledger account.
4. Connect the bank account to a general ledger account and then click Confirm.
   • Bank account name: Enter a distinguishable name for this bank account. You can view the name in the Banking tab.
   • General ledger account: Select a ledger account from your chart of accounts to connect to this bank account. 
     Important: Selecting a general ledger account is a key part of bank feed matching. Clio Accounting will automatically show you transactions in the ledger account that match transactions from your bank, allowing you to easily match them. Learn more about matching below.
   • Download bank transactions from: Enter the date from which you want the bank feed to start.

Edit bank accounts

After connecting a bank account, you can only make edits to the bank account's name. If you did not add at least one general ledger account when connecting a bank account, you have the option to also add a general ledger account. When viewing the edit modal, you can also view the general ledger accounts connected to the bank account. 

1. Go to Banking.
2. For the bank account that you want to edit, click the More Actions dropdown and select Edit bank information.
3. Under Bank account name, enter a new name. 
4. Click Confirm.

Disconnect bank accounts

If you disconnect your bank account from your bank, Clio will stop downloading bank transactions, but the bank account will still be connected to its general ledger accounts and stay in the Banking tab. You can reconnect the bank account to your bank at any time to continue downloading transactions.

1. Go to Banking.
2. For the bank account that you want to disconnect, click the three dots and select Disconnect from bank.
3. Click Disconnect from bank to confirm.

Remove bank accounts

If you remove your bank account from Clio Accounting, it will be removed from the Banking tab, all unreviewed bank transactions will disappear, and it will be disconnected from any connected general ledger accounts. Your existing accounting records will not change. If you want to use the bank account again, you will need to connect it as a new bank account. 

1. Go to Banking.
2. For the bank account that you want to remove, click the three dots and select Remove Account.
3. Click Remove bank account to confirm.

View account history (bank register)

Each bank account that is connected in Clio Accounting should have an account history. The account history is a list of accounting records that were recorded in the general ledger accounts within your chart of accounts and is often referred to as a "bank register" by accountants. 

1.  Go to Banking.
2. For the bank account that you want to view, the three dots and select View Account History.
   
   • You can now view transactions that you recorded in the general ledger accounts connected to this bank account. 

Review (categorize and match) transactions in bank accounts

Reviewing refers to matching transactions that appear on your bank account statement to transactions in Clio Accounting. The types of transactions you will see are funds in and funds out in your trust and operating accounts and firm expenses in your credit card accounts. If you have a corresponding record in your accounting ledgers, Clio Accounting will automatically suggest a match based on the system having matched the amount and date with a transaction on your bank account statement. All you need to do is confirm the match.

You may also see an unrecognized transaction if Clio Accounting cannot find a match. This can happen for a few reasons:

• Undeposited funds: Your firm logged or received a payment, but the payment has not cleared yet or is not yet available in your bank account and on your bank account statement (e.g. you received a check from a client but have not had the chance to deposit it yet).
• Banking fees: If your bank charged bank fees at the end of the month after all fees have been calculated, the bank will have information that Clio Accounting does not. In this case, you will need to record the fees into Clio Accounting.
• Incorrect values for transactions: When your firm created a record, a value was incorrectly entered so the record does not match with what is in your bank (e.g. you may have entered an extra zero to a payment amount).
• Various errors: Deposit keying errors, overpayments, underpayments, forgotten payments (e.g. a client gave you a check for payment, you deposited the check in the bank, but you but forgot to record the payment in Clio Manage), etc. can cause discrepancies between your bank account balance and Clio Accounting. 
• Fraudulent activity: Unauthorized transactions can cause discrepancies between your bank account balance and Clio Accounting. Doing regular bank reconciliations can help you catch fraud and errors early on and within enough time for recourse. 

Review suggested match

Suggested matches are transactions that Clio Accounting found in the system that match transactions on your bank account statement. You can review and confirm each match one at a time or confirm matches in bulk. Confirming each transaction one at a time on a weekly basis is recommended. When confirming matches one at a time, you also have the option to categorize if there is no corresponding match (categorizing should mostly be used for operating expenses and refers to creating a new transaction).

Review unrecognized

Unrecognized transactions are transactions where Clio Accounting could not find a match to the transaction on your bank statement. For each of these transactions, you will need to do a review and then categorize. This is mostly for operating expenses and will create a new transaction. Once saved, the new transaction will automatically match to the bank statement transaction. For hard costs like court filing fees and witness fees, you will match the transaction. You can also review and categorize deposits and match them to payments from clients or trust transactions.

1. Go to Banking.
2. If a bank account has transactions that need to be reviewed, click Review transactions.
   • Under Transactions for review, you can find bank accounts that need to be reviewed and the number of transactions that require review listed in each bank account's block.
3. Click the Unrecognized subtab to filter your transactions.
4. Under the Actions column, click Review.
5. Unrecognized transactions can be deposits or expenses.
   • If the transaction is an expense under Review this transaction:
     • Select Categorize for soft costs (operating or business expenses) or,
     • Select Match to hard costs from Clio Manage for expenses you have already recorded in Clio.
   • If the transaction is a deposit, select the option that applies to the transaction.
     • Select Match to payments from Clio Manage for payments and invoices tracked in Clio.
     • Select Categorize for invoices not tracked in Clio, non-IOLTA bank transfers.
     • SelectMatch to trust account transactions from Clio Manage if the deposit is a payment moved from your trust account into your operating account for a client invoice.
6. Complete the necessary details for the transaction and click Confirm.

Exclude transactions in bank accounts

During bank feed matching, you have the option to exclude transactions. You would want to exclude duplicate transactions caused by a glitch where your bank feed gets downloaded more than once. You can exclude transactions on at a time or in bulk. Excluding transactions is rare and should not be used often.

Add operating deposits

Adding operating deposits is part of the bank feed matching workflow. You can add deposits when reviewing unrecognized transactions or add deposits separately from the global Add transaction menu. Recording operating deposits can help you differentiate between what has actually been deposited and what has not (e.g. if a firm member forgot to deposit a check, it is easier to spot that the money has not been deposited even if there is a record of the bill payment in Clio Manage). You may need to add an operating deposit for any of of the following reasons:

• When client payments go into operating accounts directly.
• When multiple invoices are paid via credit card as one payment transaction.
• When multiple checks are deposited together at the bank.
• When one bill payment includes multiple line items, each with interest. 

For example, if your firm received multiple checks and entered them as payments in Clio Manage, and later deposited the checks, you would see a lump sum deposit in your bank feed. You can then create a deposit to match the bank transaction. In the check example, you would want to select checks as the payment included in the deposit. 

1. In the Clio Accounting header, click the global Add transaction menu and then select Operating deposit.
2. Enter a description under Memo or any associated attachments.
   • Adding attachments such as documents and receipts is highly recommended for any transactions that you record. This can help you determine if your records are accurate during a review. 
3. Under Select the transactions included in this deposit, select the undeposited transaction for the operating deposit. 
4. Under Add fees and expenses, add any fees and/or expenses associated with this operating deposit. Click Add more to add multiple fees and/or expenses. 
5. Click Add operating deposit.

Add trust deposits and trust withdrawals

Adding trust deposits and withdrawals is part of the bank feed matching workflow. You can add trust deposits and withdrawals when reviewing unrecognized transactions or add them separately from the global Add transaction menu.

• Trust deposits: These are trust fund payments that clients made to their trust accounts (i.e. payments for trust requests in Clio Manage).
• Trust withdrawals: These are transactions of earned money moving in the bank from trust to operating to pay an invoice.

For example, a trust withdrawal allows you to group trust fund payments into one transaction that moves the money from trust to operating. In Clio Manage, when you apply a client's trust funds to an invoice, payment is recorded and invoice is paid, but the money does not get moved anywhere. At the end of any given billing cycle, your firm will likely review the total amount of payments using trust funds. You can move those funds from trust accounts to your operating account as one transaction using a trust withdrawal.