Client Trust Account (IOLTA) Reconciliation - Alaska

CLIENT TRUST ACCOUNT (IOLTA) RECONCILIATION — ALASKA

Account and Period Information

I. Purpose and Governing Rule

This worksheet documents the periodic three-way reconciliation of a client trust account maintained under Alaska R. Prof. C. 1.15, which requires an Alaska lawyer to hold the property of clients and third persons separate from the lawyer's own property and to keep complete records of trust funds. Alaska Bar Rule 15.1 requires that trust funds be deposited only in financial institutions that have agreed to provide overdraft notification to Bar Counsel.

Reconciliation frequency. Alaska's rules do not state an express numeric reconciliation interval in the same terms as some states; Alaska Bar Association and IOLTA guidance treat monthly three-way reconciliation (performed when each bank statement is received) as the expected standard of care. This worksheet is structured for a monthly cadence; adjust the period above if your firm reconciles on a different documented schedule.

☐ This reconciliation is performed monthly (recommended standard)
☐ Other documented cadence: [________________________________]

Three-way reconciliation. A complete reconciliation requires that three independently derived balances agree as of the reconciliation date:

1. the adjusted bank balance (Section II(a));
2. the checkbook / control (book) balance (Section II(b)); and
3. the sum of all individual client-ledger balances (Section II(c)).

II. Three-Way Reconciliation

(a) Adjusted Bank Balance

Deposits in Transit

Outstanding Checks

(b) Checkbook / Control (Book) Balance

(c) Sum of Individual Client-Ledger Balances

Three-Way Comparison — All Three Must Agree

☐ RECONCILED — all three balances agree
☐ NOT RECONCILED — complete Section IV

III. Client Ledger Schedule

IV. Exception / Variance Investigation

☐ No variance identified — the three balances agree to the penny.

☐ Variance identified. Amount of difference: $[____]

Items investigated:
☐ Bank error / unposted bank transaction
☐ Unrecorded deposit or disbursement
☐ Duplicate or transposed entry
☐ Math error on a client ledger
☐ Bank service charge debited against principal
☐ Stale / outstanding check over 90 days
☐ Other: [________________________________]

Explanation and corrective action:

[____________________________________________________________]

[____________________________________________________________]

Date variance resolved: [__/__/____] Resolved by: [________________________________]

V. Alaska Trust-Accounting Compliance Checklist

☐ No commingling — only client/third-person funds (plus a minimal amount for bank charges, if applicable) are held in the account
☐ No negative client-ledger balances exist
☐ Earned fees withdrawn promptly once earned (not left in trust)
☐ Advance/unearned fees and third-party funds remain in trust until earned/disbursed
☐ Each client/matter has a current individual ledger reflecting date, amount, source, payee, and balance for all receipts, withdrawals, deliveries, and disbursements (Bar Rule 15.1(a)(2))
☐ Trust records (checkbooks, canceled checks, check stubs, vouchers, ledgers, journals, closing statements, accountings, reconciliations) are retained for at least five (5) years after termination of the representation (Bar Rule 15.1(a)(2))
☐ The account is held at a financial institution approved by the Alaska Bar Association that has signed an Overdraft Notification Agreement to report insufficient-funds activity to Bar Counsel (Bar Rule 15.1(b))
☐ The lawyer has signed the required Waiver of Confidentiality under AS 06.01.028 (Bar Rule 15.1(e))
☐ The account is enrolled in IOLTA (or a proper non-IOLTA individual interest-bearing account is used where funds can earn net interest for the client)
☐ The current IOLTA election (maintain IOLTA / elect not to / no trust account) has been indicated on the annual bar dues notice (Alaska R. Prof. C. 1.15)
☐ Interest on the IOLTA account is remitted to the Alaska Bar Foundation

VI. Preparer and Reviewing-Attorney Certification

I certify that I prepared/reviewed this three-way reconciliation, that it was performed in accordance with Alaska R. Prof. C. 1.15 and Alaska Bar Rule 15.1, that all client and third-person funds are accounted for, and that no funds have been misappropriated or improperly commingled. Any variance has been documented in Section IV.

Preparer Signature: ________________________________ Date: [__/__/____]

Preparer Printed Name / Title: [________________________________]

Reviewing Attorney Signature: ________________________________ Date: [__/__/____]

Reviewing Attorney Printed Name / Bar No.: [________________________________]

Alaska Practice Notes

• Safekeeping rule. Alaska R. Prof. C. 1.15 governs safekeeping of client and third-person property and the IOLTA framework.
• Overdraft notification and recordkeeping. Alaska Bar Rule 15.1 (added by Supreme Court Order No. 1706, effective April 15, 2014) requires trust accounts to be clearly identified, held only at institutions that have agreed to report insufficient-funds activity to Bar Counsel, and that records be preserved for at least five (5) years after termination of the representation. Lawyers are deemed to consent to the reporting/production requirements and must sign a Waiver of Confidentiality under AS 06.01.028.
• Reconciliation frequency. Alaska does not codify a specific numeric reconciliation interval as plainly as some states. Monthly three-way reconciliation is the widely recommended standard of care; verify whether current Bar guidance imposes a more specific requirement.
• IOLTA program. Administered by the Alaska Bar Foundation, which receives the interest and grants it for legal services to the economically disadvantaged and programs improving the administration of justice. Lawyers indicate their IOLTA election annually on the bar dues notice.
• Unsettled / verify: the precise reconciliation cadence expected under current Alaska Bar guidance (no numeric interval is stated in Rule 15.1 itself); confirm against current Bar Counsel materials.

Sources and References

• Alaska Bar Association — Interest on Lawyers Trust Accounts (IOLTA) / Bar Rule 15.1
• Alaska Supreme Court Order No. 1706 — adding Bar Rule 15.1 (overdraft notification; five-year retention)
• Alaska Bar Association — Rule 1.15 IOLTA Certification