Client Trust Statement

What is a client trust statement?

A client trust statement is the accounting a firm provides a client showing funds received into trust, disbursements made, fees transferred out, and the current balance held. Most jurisdictions require one at least annually, on request, and at the conclusion of a matter. It is the client's window into money the firm is holding on their behalf, and the document that resolves most questions before they become complaints.

What the statement should show

Every transaction with a date, description, amount, and running balance, covering the full period rather than a summary. Fee transfers should reference the invoice that supported them. Hard costs advanced and recovered appear as separate lines. The ending balance must match that client's ledger exactly. A statement that presents only a beginning and ending figure fails the purpose and, in several states, fails the rule.

Statements as a complaint shield

Clients who receive regular trust statements rarely file grievances about trust handling, because nothing is a surprise. Clients who receive nothing for two years and then see an unexpected balance often do. Send statements on a set schedule and always at matter conclusion along with the final bill and any refund. Retain copies as long as you retain trust records, which in most states is five to seven years after the matter closes.