Final answer:
To properly reconcile the client trust account, outstanding checks must be subtracted from the bank's ending balance to get the adjusted bank balance, ensuring it matches the trust ledger.
Step-by-step explanation:
When performing a reconciliation of the client trust account, any outstanding checks must not be ignored. These checks represent transactions that have been recorded in the trust ledger but have not yet cleared the bank. To reconcile the account correctly, you must subtract the total amount of the outstanding checks from the ending balance per bank statement to arrive at the adjusted bank balance. This adjusted balance should match the total of the trust ledger after accounting for all deposits in transit, bank errors, and other reconciling items. It is essential to keep a detailed record of all outstanding checks and to follow up on any that remain outstanding for an extended period, as this could indicate an issue that needs to be resolved.