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Reiter’s staff posted the information to a “standard entries”
ledger. Regarding the client trust account, only the beginning
and ending balances were posted to the standard entries ledger.
Mr. Reiter’s staff would then post this information into a
computer to generate a profit and loss statement and a balance
sheet for the law firm.
Mr. Reiter was not responsible for reconciling the client
trust account. For the client trust account, Mr. Reiter’s staff
took the starting balance, deposits, disbursements, and ending
balance directly off the monthly bank statements and entered the
information into a handwritten trust account ledger.
For each of the years in issue, Mr. Reiter determined the
law firm’s Schedule C income and expenses and prepared annual
income statements by totaling the monthly statements his staff
prepared based upon the information provided by the law firm.
Petitioner’s Merrill Lynch Account(s)
During the years in issue, petitioner maintained two “cash
management” accounts at Merrill, Lynch, Pierce, Fenner & Smith,
Inc. (Merrill Lynch). Petitioner was the only person with
signatory authority over these accounts. Petitioner’s Merrill
Lynch accounts were her personal accounts. Had Mr. Reiter
believed the Merrill Lynch accounts to be business accounts, he
would have requested the records for these accounts.
During the years in issue, several large deposits were made
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Last modified: May 25, 2011