Client funds

Most small firms take money before the work, not after it. Until an invoice exists there is nothing for that money to belong to, so Pertavo holds it against the matter instead.

An accounting firm sees the same screen; the money sits on an engagement there.

Read this part first

This is not a trust account. There are no segregated client accounts, no three-way reconciliation and no bar reporting. Pertavo records what moved; your bank holds the money, exactly as it does for an invoice.

If your jurisdiction requires client money to sit in a regulated account with a reconciliation you can produce on demand, that account lives somewhere built for it, and nothing here replaces it. What this gives you is an answer to “how much of theirs are we holding on this matter, and what have we spent it on” without opening a spreadsheet.

A ledger, not a balance

Two kinds of movement are recorded against a matter:

• Receipt — money in.
• Refund — money handed back.

What has been spent is not a third kind. Spending happens when funds are applied to an invoice, and that is recorded on the invoice, so the bill and the account can never disagree about it.

The balance is therefore three sums rather than a stored figure: receipts, less refunds, less what has been applied. Nothing has to be kept in step with anything else, because there is only one copy of each fact.

Each movement keeps the amount as received, in the currency it arrived in, with a method and an optional reference. A figure nobody can point at in a bank statement is a figure nobody can reconcile.

Spending it

On an invoice, Apply funds sets what the client has already paid against what they now owe. The amount cannot exceed what is held.

Nor can a movement be removed if doing so would take the balance below zero — the check is the balance after the removal, because taking back a receipt that has already paid an invoice would leave that invoice settled out of nothing.

What the client sees

Their own money, on their own matters: what they have paid you, what has been spent, and what is left. They cannot see another client’s, and the ethical wall covers these rows with no separate rule, because everything here is scoped to the matter.

What this does not do

• No interest, and no IOLTA. Nothing calculates or allocates interest on money held.
• No bank feed. Nothing watches an account; every movement is entered by somebody at the firm.
• No conversion. A receipt in one currency is not translated into another.