Posting settlement disbursements to Xero
How a disbursed case lands in Xero today, and what changes when Disbo posts each payment · October 2026 · Disbo connects to Xero (Live)
How it runs today
When a case settles, the bookkeeper receives a signed settlement statement and a stack of checks or a list of payments, and turns them into entries in Xero: a deposit to the trust bank account, a credit to the client's trust liability, one line per payout with a memo, costs reimbursed to operating, the fee to income. Every line is typed from a document that already contained it. At month end the trust bank balance, the trust liability and the sum of client balances are brought to agreement by hand.
| Step | Done by hand | With Disbo posting to Xero |
|---|---|---|
| Deposit | Typed from the bank feed and matched to the contact | Matched to the contact with the case number |
| Payouts | One line per check, memo typed each time | One entry per payout in your memo format, check number as the document number |
| Case costs | Reimbursement to operating posted separately | Posted from operating with the case on the line |
| Fees | Disbo's fee typed from the invoice | Posted to the operating fee account you choose; never from trust |
| Voids | Reversal typed; closed periods adjusted by hand | Reversal in an open period; a void log for closed ones |
| Month end | Three balances brought to agreement by hand | Reconciliation export, in beta with a small group of firms |
Anonymized client results: a seven-payee disbursement took a firm about 2 hours by hand and about 30 minutes in Disbo; a firm found $200,000 sitting in trust once balances were shown by case.
With Disbo connected: what moves, and which way
Xero stays the system of record. Disbo is the payment record. Each item below is stated for Xero specifically; the connection is live today.
Xero → Disbo · what comes in
- Chart of accounts, contacts (your client ledger), vendors
- Bank deposits and the bank feed for matching
- Costs already paid from Xero or a card, onto the case
Disbo → Xero · what goes back
- The settlement deposit, matched to the contacts
- Each trust payout as a check or expense with the check number as the document number, your memo format and posting date
- Case costs from operating
- Disbo's fees to the operating fee account you choose
- A void and reissue, in an open period
Write-back scope is per system. This list is Xero's; the key between Xero, Disbo and your books is the case number.
The field map
| In Xero | In Disbo | Used for |
|---|---|---|
| Trust bank account | Trust account | Deposits and every trust payout |
| Client trust liability (one ledger, contacts as client ledgers) | Case ledger | Per-case trust balance; sub-accounts per client set up with our team |
| Operating bank account | Operating account | Case costs and the firm's fee |
| Fee account (operating) | Fee posting | Disbo's fees, never from trust |
| Contact name | Payee naming | "Last, First – case number" |
| Memo / document number | Payout memo template | Check number as the document number; your memo format |
| Posting date | Posting rule | Issue date or cleared date, your choice |
Connected in four steps, on one call
Our implementation team does this with your Xero admin on the implementation call. An hour or two; most firms send their first payment within two weeks.
01 · Connect with API credentials From your Xero admin; our team connects trust and operating.
02 · Map accounts Trust bank account, trust liability ledger, fee account, posting date.
03 · Set naming and memo Case-number source, payee naming ("Last, First – case number"), payout memo template.
04 · Post one test payment and compare Compare it in Xero; then switch posting on.
Bring to the call
- Someone with Xero admin rights
- Case numbers in contacts names
- One trust ledger with contacts as client ledgers (per-client sub-accounts: set up with our team)
- Your memo convention
What stays where
- Read-only until you switch posting on; the chart of accounts and vendors are read, never changed.
- Moving from QuickBooks to Xero is a remap of the accounting sync, keyed on the case number; not a reimplementation.
- Voids in open periods post as reversals; for a closed period Disbo gives you the void log and you post the reversal.
Ask on the call
- Which account is the trust bank account and which is the client trust liability?
- What memo format does the bookkeeper want on every payout line?
- Do we keep one trust ledger with contacts as client ledgers, or sub-accounts per client?
Before you disburse: the checklist
Works with or without Disbo. Run it after the client signs and before the first payment leaves trust.
- The settlement funds have cleared in the trust account (deposited is not cleared).
- The client has signed the settlement statement and the signed copy is saved to the case.
- Every lien amount on the statement is confirmed in writing; the letters are in the file.
- Medicare uses the final demand, not the conditional payment estimate.
- The attorney fee follows the basis in the signed fee agreement; any referral fee is disclosed and paid from the fee.
- Case costs are itemized from the ledger; none are estimates.
- The statement foots: gross − fee − costs − liens − government and subrogation − other − holdback = net to client, to the penny.
- Each payee has a legal name, a mailing address or a verified bank account, and the documents to enclose.
- Any holdback has a written release condition and a date to re-check it.
- The signer who will approve the disbursement is available, with two-factor set up.
- Every payment will be posted to the case ledger and the books on the day it is issued.
What Disbo does not do
- Generate the settlement statement. The firm prepares it in the case system or from our template; Disbo reads the signed one.
- Negotiate liens or track bills. Amounts come from the statement as signed.
- Hold the money. Checks are drawn on the firm's own account; electronic payments pass through a bank partner for seconds.
- Take fees from trust. Disbo bills the firm's operating account.
Disbo connects to Xero today. See the connection in a 30-minute demo: disbo.com/book-demo · Integration page: disbo.com/integrations/xero · Three-way reconciliation is in beta with a small group of firms.
Disbo (disbo.com). Educational material, not legal advice. Sample firm Westbrook & Vale and all figures are illustrative.
FAQ
Our firm is moving from QuickBooks to Xero.
A remap of the accounting sync, keyed on the case number; not a reimplementation.
Does Disbo change anything in Xero?
No. It reads the chart of accounts, customers and vendors and posts entries; it never edits what is there.
What happens to a void after the period is closed?
Disbo gives you the void log; you post the reversal.
Is reconciliation included?
The three-way reconciliation export is in beta with a small group of firms; the worksheet on the templates page covers the month end meanwhile.