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When it comes to legal research tools, the internet is the most widespread resource everyone uses, almost without question. Having the savviness to find and use the best free and/or budget-friendly tools gives attorneys an edge – especially at smaller or mid-size practicing firms. As we’ve seen, these tools continue to evolve, providing legal researchers (no matter their role) the agility to find the right information needed for the case. Complete with alerts and filters that prevent endless scrolling and frustrating hours lost sifting through everything but the statute you’re looking for, it’s clear legal research has made life easier – if you know how to access the right tools, that is.
Having hands-on resources for your law firm’s needs will undoubtedly create more meaningful research that drives cases forward. This has been a game-changer for smaller firms who once had to shell out huge expenses for legal research software. Gone are those days; and good riddance, too. Simplifying research will also open up more time for other things, such as organized calendaring and day-to-day operations.
We’ll be covering the following questions:
Although nothing can quite replace a powerful paid tool depending on your needs and area of law, there are some free and more affordable tools available that make top-level research quite easy:
Even the best attorney doesn’t always have all the answers. The best offense in any matter is having a good defense – including knowledge on opposing counsel, and the relevant authorities and cases they’ll be relying on. It can be difficult to navigate strategy when you’re too busy trying to search for the opposite counsel’s angle as well. These obstacles can mount, especially when you’re fighting or are getting blocked and limited on your research attempts. If the research comes easy, so, too, will the brainstorming.
As a smaller firm, the cost analysis could also prove problematic if you’re billing clients for extensive research conducted. It’s important to weigh these options before going into a case that you anticipate will require ample research time, especially for newer attorneys not as well-versed or equipped with as many resources at a smaller firm or solo practice. This is all part of mapping out features that will be user-friendly for you, this time and the next – so clients stay happy, too.
As we mentioned before, organization begets organization – so adding these online legal research sites and databases to your toolkit is only going to further empower your firm to drive business and spend time brainstorming rather than doing mindless research. The very same can be said about your case management software that’s used day-to-day.
Let’s go back 16 years to 2005. The youngest millennials were what? Around 8 years old? And if you were to take a look at websites and law firm’s online presence 16 years ago, what you would see was an unaesthetic, barebones framework with an ‘About Us’ section, a stock photo (if you were lucky), and a phone number. Having an online presence back then meant really one thing: you had a website.
Fast forward to 3 years ago, and what do we have? An internet that looks wildly different. Being online doesn’t mean you just have a website, it means you are immersed and engaged in the multitude of layers that make up this new age online presence. We know that sounds vague, so don’t stop reading because we’re about to dig in.
Let’s talk about some facts first.
In a 2019 survey, a hypothetical question was posed to the participants stating: “If you were faced with a legal issue, where would you search for help? 64% of those people indicated that they would go to Google before any other platform, resource, or person to get help.
But when the question was posed about where one would go if they actually needed an attorney, as opposed to merely researching, 62% of those people said they would get an attorney or law firm referral from a friend or family member, not google.
Now with this in mind, that same group of people also stated that they would visit a law firm’s website prior to meeting or calling the firm. And this can be true for many service-based industries.
Today, millennials and the younger generations are seeking information on their own, prior to picking up the phone. It is also important to note that while they are making decisions and researching, comparing, and analyzing which of the many firms would fit their needs, they are also reading client reviews. And with the advent of the internet, and everything that has come with it, these online reviews are not only prevalent but incredibly important.
According to the Pew Research Center, millennials are born between 1981-1996, they’re in their 20s and 30s now, and if they are not your current clients, they will be.
We know what you may be thinking, millennials have gotten a bad rap and you would prefer to carry on how you have been and let them involve themselves elsewhere, but we are telling you now, don’t do that! Don’t believe us? Keep reading.
This demographic grew up with the internet and mobile phones, they are digital natives. To put bluntly, this age group knew more about Amazon the company than they did about Amazon the river when they grew up. And not only are millennials the largest generation, but they are also the largest population when it comes to the workforce.
Millennials communicate very differently than other generations. They do not prefer to talk on the phone, rather they prefer communicating via text or with images. This is important to note because many people (millennials included), will look for alternatives if the organizations they originally searched for do not communicate the way they do. That isn’t a threat, it is simply just the way it is. Think of it as a relationship. If your partner only communicated with you one way, but you preferred another and there was no compromise or change of action, the likelihood of them becoming your spouse is very low. It’s the same with communicating with your clients.
Additionally, millennials are “addicted” to social media and the happiness and overall validation it provides. Now, if you don’t think social media is important or relevant to your business, let’s take a look at why you may be wrong. Visual Capitalist’s conducted “A Minute on the Internet in 2020” where they estimated the amount of data created on the internet in one minute. Here is some of what they found:
And this is all in 60 seconds, that is crazy! It took longer than 60 seconds to even type that information out…
We’re in a numbers kind of mood today, so without further ado: 91% of people between the ages of 18-36 (cough millennials), trust strangers reviews online as much as personal recommendations, and 93% of those consumers say that online reviews influenced their purchase decisions.
And for the bad news bear, a 3.3-star rating is the minimum for what business consumers would feel okay engaging with, where only 13% of people will consider buying from a business that has only a 1 or 2-star rating. 94% say an online review has convinced them to avoid a business, and you risk losing as many as 22% of customers when just one negative article is found by users considering buying their product.
Now for Millennials specifically, a study showed that 8 out of 10 millennials will never buy anything without reading a review first and 77% trust reviews they read on brand websites. So what is the takeaway here? Reviews are crucial.
And from an SEO standpoint, Google places a high priority on them. Reviews provide value, Google knows this, so these reviews will take up real estate on the first page before even paid ad content. The better your reviews are, the higher you will rank on this search engine.
Now if you’re wondering how to get reviews the answer is simple! Ask your current clients. If they’re using Gmail, leaving a review will be quick and painless. You can create surveys and provide your clients with all the information they would need to take 3 minutes of their time to write about how their experience was. Firms obviously handle a lot of sensitive information, you may have clients who are reluctant to publicly disclose their stories, but fortunately, millennials are very open, honest, and very straightforward. A study showed that 25- 34 year olds are the most vocal when it comes to reviews. Roughly 23% of reviews are left by people are in that age category. Let’s dig deeper.
The first thing you need to do is establish that your firm takes reviews seriously. And how do you do this? You communicate it with your staff. If your team doesn’t know that it is important for them to ask their clients for reviews, they probably won’t do it. Once everyone is aligned on expectations, you need to have a very clear system on how to get a successful review from your client.
Here are some things you should be asking yourself in order to build a system of reviews and ensuring you’re getting the best possible reviews from your clients:
A good rule of thumb for asking for reviews is to ask as soon as possible. If you leave too much time between when you ask and the close of the case, the likelihood of getting a ‘yes’ will be lower.
Practice management software will allow you to automate the follow-up process so that you can create workflows that will trigger a specified email template to be sent to your client following the conclusion of their case (or whenever you set it in the system to be sent). Survey’s are beneficial because you can control the questions being asked and they are relatively fast for your clients to respond to. Keep in mind that you can control some of this conversation. Make it as easy as possible for your clients by giving them guidelines of what they should stay away from (specific case details), and what it is okay to talk about (their experience with your firm, attorney responsiveness, customer service, etc.)
Make referrals easier. 62% of all legal clients are asking their friends and family for firm recommendations. In your intake process, you should be tracking where referrals are coming from and at the close of a matter, you can have referral forms automatically generated and emailed out for your clients to fill out.
First of all, it is important to remember that bad reviews happen! I you get one, it may not be an accurate indication of the actual services your team provided, your client could just be having a bad day. So don’t sweat it. Also, we all know there is “that person,” the person who is never happy or just prides themselves on leaving tough critiques. So take it in stride and don’t take it personally!
If you do get a bad review, the first things you should do are:
It is important that you follow up with your clients after the review has been written, especially if it is not favorable. Doing this will provide you with the opportunity to speak with that client and ask if there is anything you can do to improve their experience. Always lead with asking “What can I do better?” or “How can I fix this?” Instead of, “I’m sorry you had a bad experience, but do you think you could write a better review?” Also, a bad review can simply be taken as a learning experience.
The rule here is simple...
Do not respond to a review in which you disclose confidential information. End of story.
And we are just going to throw this one out there too - don’t pay for reviews.
If you walk away with one thing from reading this, it should be that reviews are important. And as the adage goes: “Closed mouths don’t get fed,” so ask your clients! You’ll be surprised at how willing they will be to help you.
Prior to 2020, if your firm paid freelancers, contractors, or other non-employees $600 or more during the year, a 1099-MISC would be issued and sent to the payee.
In 2020, the IRS released form 1099-NEC, a new form that will change the way 1099-MISC reporting has been handled for years.
This 1099-NEC was added specifically for reporting non-employee compensation. This will include payments to individuals who are not employees, as well as payments for services to partnerships, estates, or, in some cases, corporations (such as attorneys and law firms).
Yes, the 1099-MISC is still being used, however, it has been redesigned, so it will be especially important to pay close attention to how payments are being reported in early 2021.
Let's take a look!
To start, let's talk about what exactly has changed. To help give you a better visual, below is a chart indicating what exactly has changed between the 2019 form and the 2020 forms:
Any payments in 2020 to attorneys and/or law firms for services rendered should now be entered in Line Item or Box 1 of form 1099-NEC. Gross proceeds, such as settlements paid to attorneys/law firms, should now be recorded in Box 10 of 1099-MISC.
It will be more important than ever to review all vendor settings to ensure that 1099 vendor payments are reported in the correct box and on the correct form in 2020.
Form 1099-MISC must be filed by March 1, 2021, if filed on paper, or by March 31, 2021, if filed electronically. But vendor record review should begin as soon as possible because the 2020 accelerated due date for filing form 1099-NEC with the IRS is on or before February 1, 2021, whether you're using paper or electronic filing procedures.
A best practice to prevent the beginning of the year scramble to obtain missing information from vendors is to require a current W-9 prior to issuing any payments to vendors. This will ensure that each vendor record is set up properly in the accounting system. Further, an updated W-9 should be requested at the beginning of each year, prior to issuing any additional payments, to confirm that the information contained in the vendor record is accurate from year to year.
If you're using a legal practice management software, records and data may look different, but in Centerbase, each vendor has its own record where settings specific to that vendor are located. This makes reviewing and editing the vendor’s 1099 settings a very simple process. Additionally, documents such as the current W-9s can be attached and notes can be entered on a vendor record, making verification of 1099 information quick and easy.
Remember that any credit or debit card payments to vendors should be excluded in what is reported to the IRS since each credit card company (payment settlement entity) reports payments via credit card to vendors on form 1099-K. If credit card payments were to be included in the amounts reported on 1099-MISC or 1099-NEC, it would result in the reporting of the vendor’s income to the IRS twice. This may ultimately result in the necessity of filing corrected 1099’s if requested by the vendor. Centerbase provides the ability to filter out credit card payments from the 1099 vendor report, eliminating the necessity of manually reviewing all vendor payments. This report can be downloaded and used to prepare 1099’s each year.
Preparing for filing 1099’s is going to take some additional effort in early 2021, specifically as it relates to legal settlement accounting. With the filing deadline for form 1099-NEC only 31 days into the new year, getting started on vendor review as soon as possible will be essential.
Now that you are armed with the knowledge of the changes to 1099-MISC and what is to be reported on the new form 1099-NEC, you should be able to accurately conduct 1099 reporting for 2020.
For more detailed information regarding 1099-MISC and 1099-NEC reporting for 2020, check out the IRS instructions.
For many firms, accounting is a huge pain point. It’s time-consuming and tedious, but it’s crucial to any business’s operations.
But before we get into the nitty-gritty, what does it even mean to close out a firm’s books? Keep reading and we’ll tell you!
Closing a firm’s books is the process of finishing up all accounting activity for an accounting period and ensuring that the general ledger accurately reflects the financial activities of the firm.
There are many closing procedures that should be followed on a regular basis throughout the year, but there are also additional procedures to include at year-end. We know, that’s just adding more to your plate, but these year-end procedures should be given special attention prior to closing the books for the fiscal year and we’ll tell you why.
Profit distribution can occur at any time during the year, so it is critical to maintaining a complete and accurate financial picture so that appropriate projections of net income and cash flow can be made whenever required. By establishing regular month-end procedures, your firm can better maintain an accurate financial picture throughout the year and, in turn, will ensure a smoother year-end closing of the books.
Of course, each firm is different and the procedures that are put in place will vary from firm-to-firm, but we have tried to make it as easy as possible for you and compiled a list that includes some basic, monthly procedures that your firm may find useful.
1. Distribute a list of outstanding, unpaid accounts receivable that are 90 or more days past due to the responsible attorney for collection efforts.
2. Ensure that all timekeepers are current with their time entries by the end of each month so that billing will not be delayed.
3. Record all incoming cash.
4. Review the Aged WIP Report to identify fees that can be billed and those that should be written off.
5. Reconcile all cash and credit card accounts, entering all unrecorded transactions.
6. Review and reconcile petty cash.
7. Record month-end payroll journal entries.
8. Review the Payment/Credit Allocation Details report, filtering for any credits for expenses.
9. Review liability accounts to ensure accuracy.
10. Review the Comparative P&L Report.
11. Review the Trial Balance.
12. Prepare draft Profit & Loss Statement, Balance Sheet, and Trial Balance and provide to CPA for review and tax planning (and tax preparation at year-end).
13. Enter any adjusting journal entries per your accountant's instructions.
14. Print and save finalized financial statements.
15. Update the closing date in System Settings to ensure no changes can be made that will affect the financial statements for prior periods.
And if you were thought that was it think again because we have more! In addition to the above, at year-end the items below should also be added to the closing procedures.
1. Request that all expense reports be submitted to accounting in plenty of time for processing, so they can be paid prior to year-end.
2. Review IOLTA balances and request replenishment according to the firm’s policies so there are sufficient funds on hand to apply to client bills at the end of the fiscal year.
3. Update accounts payable.
4. Pay down line of credit.
5. Plan for and enter any retirement plan funding.
6. Plan for and enter any year-end bonuses.
7. Budget for sufficient cash on hand and adequate line of credit for the first quarter of the following fiscal year.
8. Account for partner/shareholder distributions.
9. Enter adjusting entries for depreciation, bad debt, etc.
10.Enter final adjusting journal entries per accountant's instructions.
11. Per the Accounting Period End Date set in the Accounting System Settings, Centerbase will process the year-end closing entries to book the current year’s net income to retained earnings.
At this point, you’re either thinking “oh boy,” or “wow that was helpful!” Either way, we want to try to make this process as easy as possible for you so we have created an Accounting Period Closing Procedures Checklist to assist you in assigning and tracking the tasks listed above.
End-of-year closing is never fun, but hopefully these steps and checklist will help you keep billing, collections, and your financial records up to date!
In Calendaring Best Practices: Seems Simple, but Is It? we talked about calendaring best practices, and establishing a workflow. Today, we will connect some dots and focus on the dreaded missed deadline, bad habits, and improving inefficiencies. Calendaring is critical to your day-to-day operations so don’t take it lightly! If you don’t believe us, keep reading.
Did you know that lawyers have a 17% chance of being sued for malpractice every year?
According to the American Bar Association, nearly a quarter of all legal malpractice claims are based on lawyers procrastinating or failing to calendar.
Crazy, right?!
If you look at all of these statistics, you will see that they are predominantly related to bad habits and inefficiencies. Let’s take a look at some of the bad habits plaguing the attorneys who are getting hit malpractice suits.
Waiting to schedule deadlines
If you’re not tracking and recording these deadlines as soon as they come in, you could be leaving yourself at risk for malpractice.
Missing centralized calendars
If someone at your firm loses their calendar, or cannot see deadlines the rest of the firm is trying to meet, the more likely a misstep will occur. A rule of thumb to successful calendaring is transparency and visibility.
Lack of research
If you’re practicing in a new jurisdiction, you need to know the local rules or any rule changes. Even if you’re a new attorney, brush up on the regulations and make sure your bases are covered.
Failure to plan
If you do not have a plan of attack as to how you’re going to meet your deadlines, you will be leaving room to not only procrastinate but to forget about what you have due entirely.
Deadline reassignment
If your staff changes or someone gets sick, those court deadlines won’t change. Your clients should not be on the receiving end of your firms' disorganization when life happens. Always be prepared, and have a backup plan in case your team faces a disruption.
Entering deadlines
It is very inefficient to enter deadlines on a calendar one-by-one. If you have a high volume practice and one person is in charge of entering deadlines, it may take them a few days to enter everything in accordingly. And at that point, you are now a few days into a 10-day timeline, or whatever the timeframe may be.
There are many things that can go wrong in the span of one case. Many of these things are out of your control, but some are not. Let’s go through some of those examples:
All of these examples severely impact your client. It is worth taking the time to modify and ensure that your calendaring practices are not only accurate but are standardized across the firm.
You may have read those three steps and sighed. That’s a lot of work! But it doesn’t have to be.
Instead of researching deadlines and inputting dates manually, there are ways to automate this process so that you are not only spending less time on it, but you are remaining more accurate and consistent as well.
There are a considerable amount of advantages that come with using a practice management software, let’s take a look:
Aside from having to meet court and document deadlines, you have regular tasks and everyday to-dos that you have to keep up with. Whether that includes client consultations, new client intakes, progress reports, managing your staff, and not to mention being able to go home and turn off your work brain for a little and enjoy your personal life. All it takes is a plan, and we encourage you to try to implement one of these calendar tips today.
Make sure all your appointments are filled in, check your upcoming deadlines, and ensure you have blocks of time reserved to be able to work towards those deadlines and begin crossing things off your list of to-dos. Also, be thinking about the top 2-3 activities that you can accomplish for that day. You don’t need to write this down, but take mental note of what went well that day, what you're grateful and blessed to have, and what you appreciate. It may seem insignificant, but in this fast-paced, high-stressed industry, it is important to take a moment to acknowledge the good.
In addition to looking at your calendar and mentally taking note of everything you have on your plate, try to solidify 3-4 concrete action items or tasks to complete for your work, your relationships, and your personal life. If you already know this, then bear with us for those who don’t. Your work productivity, happiness, and satisfaction with your life are influenced by your relationships and personal life outside of work.
For relationships, this could be anything from calling your parents to check-in, or writing back to an old friend or old co-worker. Little things like this make a difference and they do matter. For your personal life, this could be as simple as scheduling yourself a lunch. Often times, attorneys and legal teams will get so busy they forget to eat. We aren’t scientists here, but glucose level and productivity go hand in hand. All these things may feel like a distraction at times, but your motivation and the type of work results you produce will correlate in some shape or form with how the rest of your life is going. So take a minute to incorporate those elements into your calendar because they are important.
Sometimes when people have access to a firm-wide calendar, there is a tendency to grab any time they want and book you for things without asking first. All this does is throw you off. If you spent Friday planning out your week and then you find that come Monday there are multiple chunks of your day booked out already without you knowing, you will have to completely adjust what you had planned to do. How do you fix this? You set verbal and transparent boundaries. For example, set specific days for allotted activities. Maybe Tuesdays and Thursdays are when you do your inbound consultations and client calls. So when someone calls your staff requesting your time, they will know to slot them in on either Tuesday or Thursday.
The Pomodoro is a proven and popular time management technique. The premise here is that you work in blocks that typically last 25 minutes that are called Pomodoro sessions. You work for 25 minutes straight, focusing on your work with zero distractions then you follow that up with a 5 minute period of rest or a break. The result of this is productivity and higher management of distractions. Now after 4 Pomodoro sessions, you’re supposed to take a longer, 20-minute break to step away from your work, catch your breath and clear your mind.
Delegate where appropriate and have dedicated time to review with staff. If you’re using practice management software, you will have a way to manage projects at a glance and also get really granular insights into the work your team is doing. This will enhance your firm's productivity overall and the quality of service you are able to provide to your clients.
If your scheduling regular dates to review your matters and you have specific staff assigned to those matters, pull up the calendar and go through everything that you expect needs to be done or completed by that person. The earlier and more often you do this, the easier it will be to catch mistakes and avoid missed deadlines. Additionally, give these staff members the opportunity to talk about their workload, and give them feedback on the quality of their work. Also, use this time to offer support and constructive feedback; if you don’t like how something is being handled, let them know, or if you are happy with something you should express that as well.
Calendaring is important. If you walk away with only one thing, it should be that. You may not be able to implement everything we just talked about overnight, but if you can start today, you will only improve company morale, ensure that no task is being forgotten, and you will help foster a system of efficiency and excellence within your firm.
As we draw near the end of 2020, many attorneys find themselves faced with the same universal question — “Is there any way I can collect on my outstanding receivables before the year is out?” Although it’s not something you dreamed about in law school when you thought about practicing law, collecting on unpaid bills is a vital aspect of your business. Ideally, you should want to end your year with as much money in your pocket as possible. But, how can you collect on invoices that some clients thus far have ignored or refused to pay?
First, some quick definitions. Accounts Receivable, or “A/R,” is a term that refers to unpaid balances left on a client’s account. Furthermore, an “Aged A/R” is an unpaid balance that has been left standing for a certain, prolonged amount of time (say, for example, a client has not paid their invoice in over 60 days).
Now, let’s present a common scenario: Your client emails you saying she cannot pay her outstanding invoice. In this instance, many lawyers choose one of three options: 1) hang on to the invoice and hope their client eventually pays it; 2) enlist the help of a debt collector to obtain the funds; or 3) simply write off the debt when the year is over. Option One is less than ideal, because you have no assurance of ever getting paid. Option Two is hardly ever preferred because you still want referrals from that client, and handing over their outstanding balance to a collections firm is not likely to instill good feelings between attorney and former client. Thus, the majority of attorneys end up choosing Option Three, wherein they simply write-off the debt at the end of the year.
But, is there another way to get paid on an account that you were all but ready to write off?
The short answer, for the most part, is yes! Attempting to collect on unpaid invoices is not a fruitless endeavor, no matter how aged the invoice is. Let’s look over a few quick tips to point you in the right direction.
Naturally, every client you take on is unique in their own special way, and this also translates into their invoice payments. There is no “one-size-fits-all” solution to collect on A/R—every client with an outstanding bill will require a different strategy, but there are still some universal applications that you can utilize to track down your payments.
You can accomplish this by first creating a list of every client with an unpaid invoice, including their name, their matter number, the amount they owe, and how long the balance has been overdue (i.e., 30 days, 60 days, 90 days, and 120+ days). If you work at a firm with multiple attorneys, you could also label each invoice based on the primary attorney overseeing the case.
Once you’ve put your list together, you can then determine which invoices you should go after first. You may consider tackling the “youngest” invoices first—that is, the invoices that have gone unpaid for the shortest period of time (let’s say 30 days, for example). Set aside time in your day to email these clients with a short, to-the-point message about their outstanding invoice, including the amount they owe. Include a link for the clients to pay online - the goal is to eliminate friction between your client’s pocketbook and your bank account. From there, you could expedite the process by duplicating the email for the remaining clients on your list—simply change the names and the amount owed, and send it off. This email should come from the attorney working the case; the attorney’s email address is more likely to grab the attention of the client.
When dealing with the older invoices, you can follow a similar plan as above, at least with the clients whom you believe will pay if prompted (or will have a way to do so in the near future once you’ve reminded them). However, there is a high likelihood that you have clients on your A/R list whose ability and/or willingness to pay don’t inspire much hope on your part. These are the clients that you fully expect to write off at that end of the year.
In these cases, consider offering the clients an opportunity to wipe a portion of the debt away if they pay within a certain period of time. For example, if a client owes you $10,000.00 and has not paid you in over six months, consider emailing them with an offer that if they pay half of their balance ($5,000.00) within the next three business days, you will forgive their remaining balance. You would be surprised at how many clients will take you up on this.
Another way to turn unpaid invoices into paid invoices is to make it easier for your clients to pay you. That’s where an online payment solution can make a big difference. These solutions give you the power to email your clients an electronic invoice that they can pay with a credit card, debit card, or eCheck. Rather than having to find their checkbook, write out a check, find an envelope, and break out their stamps, your clients can pay you with a few clicks of a button.
You would be doing yourself a favor in the long run by integrating online payments into your practice. Like it or not, cash and check payments are becoming less popular in favor of online payments and credit cards, with less than half of U.S. adults carrying cash on them on a regular basis.
Ideally, you should use an online payment solution that was built with the legal industry in mind, with features that can correctly separate earned and unearned fees and protect your IOLTA account from third party debiting. You can stay compliant with your state bar and also provide a benefit to your clients at the same time.
In short, giving your clients the ability to pay online will not only entice your late-paying clients to pay their invoices, but will also entice future clients to seek your services by giving them the payment options they most commonly use for most every service in their daily life.
This is only a cursory look at some of the strategies you could employ to get more cash in the door before the year’s end. If you’re looking for a deeper dive on collecting unpaid invoices from clients by the end of 2020, read LawPay’s latest e-book, Finish Strong: How to End the Year on Better Financial Footing. You’ll discover essential steps to keeping your cash flow strong at the end of your year, and you’ll leave with the right tools to reduce your outstanding receivables going forward into the new year.
Jordan Turk is a practicing attorney in Texas, and is also the Legal Content and Compliance Manager at LawPay. She earned a B.A. in Classics, History, and Religious Studies from the University of Texas, and went on to earn her law degree from the University of Arkansas School of Law. Prior to LawPay, Jordan worked with a high-asset family law firm in Houston, Texas.
Technology is a driving force behind trends that significantly impacts the way your clients consume and interact with data. Ditching old habits can be hard, there is no argument there, but the benefits of adopting these new tech-driven changes will be the difference makers between profitable and unprofitable firms.
Calendaring. It seems so simple and trivial, but there is nothing more critical to your day-to-day operations than an accurate and up-to-date calendar. It is really important to evaluate and understand what types of calendars each attorney is using. If 2020 has taught us anything, it’s that we must be able to effectively utilize distributed workspaces; so if your calendar is a paper planner zipped up in your briefcase, staff working remotely will most certainly not be able to access it.
This blog will be broken up into two parts, part one today will focus on best practices, and establishing a workflow, and part two will focus on the dreaded missed deadline, bad habits and inefficiencies, and how to achieve calendar zen.
Let’s jump in.
An office-wide master calendar is a really good rule of thumb. Having one place where all of your dates are listed across the firm, regardless of the attorney that’s working on it, is a really good thing to have. Having a redundant calendar is important. If you’re using Outlook 365, that needs to sync to your practice management system. Transparency and visibility cannot be sacrificed.
You should set one review date for every matter to ensure they are being kept on track. What does this mean? You don’t want to have 200 matters in your system and then realize in 6 months that you’ve only touched 40% of them. Having a recurring date to review your matters on a regular basis gives you time to see where each case is, to check in with your clients, and most importantly just keep everything organized and up-to-date.
The longer your case stays in your office, the less profitable it becomes. Take in cases, wrap them up efficiently, get them out the door, and collect your payment. The tighter you can make this process, the more money you will make.
Enter your deadlines as soon as you’re aware of them with spaced out reminder dates. As soon as you know that a deadline is apparent, whether you’ve been served with discovery from opposing counsel, or a trial date has been scheduled, you want to make sure you get those dates into your calendar so that you do not forget about them. Having a tiered system to enter dates is also a smart thing to implement. Setting a reminder date to notify you that a deadline is coming up, an urgent date to alert you that you must take action now, and lastly a warning date right before the actual due date. By creating this tiered level of reminders, you will be able to stay more organized, and file motions for extensions if need be.
Make sure all attorney and non-attorney staff are held accountable. Everyone should know what their role or responsibilities are when it comes to deadlines. Whether they are in charge of entering the activity, drafting paperwork corresponding to the event, editing, filing etc. Everyone should know what they are responsible for. If one person drops the ball and misses a deadline, there should be no reason why anyone else attached to that activity misses the deadline.
Give yourself enough time to investigate and work towards a deadline. Some dates are pretty clear cut. But there are other rules that are slightly more ambiguous and may require more research. An example of this could be if you’re taking on a case in a new jurisdiction. Give yourself enough time to investigate and work towards those deadlines.
Failure to react to the calendar is another field the ABA takes into account when they look at reasons for malpractice. So even with the best technology and minimal human error, if you’re avoiding or dismissing deadlines, there may be a bigger problem. For example, if you’re practicing law in an area you are not 100% familiar with, or if you’re working for a client you don’t particularly like, you need to figure out if you can find ways to combat those issues directly because if you cannot meet the deadlines, you need to remove yourself from the case.
A good master calendar is crucial for firm-wide visibility, collaboration, and accountability. Many attorneys have the ability to manage their workload in their own way, this includes managing their own court calendar. However, every firm should still have a master calendar that is managed by a well-trained member of the team that can constantly keep it updated. If events are not updated, attorneys assisting on matters may be more prone to miss key dates or information.
Firms should also consider different viewing formats or filters. Your calendar must be agile and flexible enough to provide you with filtering options. In most cases, there are many filtering options that you can utilize, but it is best practice to explore which filters work best for specific teams. If your firm has different geographical locations you can filter by a specific area, or if you only want to view some members of the team over others, you can filter by that criteria as well.
A good master calendar should be backed up regularly, either offsite or in the cloud. Depending on what you’re doing, if you have an on-prem system you are going to want to have a backup copy of that calendar in another location that is not your physical office. This is for reasons like natural disasters, break-ins, server malfunctions, etc. There are so many things that could happen and you have to be prepared for them. Cloud-based backups are very easy to implement. If you’re already paying for cloud services, your cloud provider should be doing most backups for you automatically.
Your master calendar should also flow to and from matter-centric calendars. If you’re using practice management software, you want anyone who has privileges to access a matter in your system to be able to see the relevant dates and information for that matter. Additionally, this calendar should be accessible from your mobile device. Attorneys are on the go more often than not, so it is crucial that this information is available wherever they are. Make sure you turn on push notifications and reminders so that when you are using your mobile device for calendering, you are alerted to what is due and when just like you would be on your computer.
The roles and responsibilities for everyone involved with calendaring should be clear. Who enters the dates when activities are made clear? Is there someone who is going to be responsible for double-checking those calculations for deadlines? Have tasks been assigned according to the upcoming deadline so everyone knows what their responsibilities are in order to meet them?
Your calendaring process should be standardized across the firm to ensure continuity if staff changes. If that staff change does occur, then will you be able to easily train them on your process? Or if someone is out of the office, or they’re sick, you don’t want to have to call them with an emergency because the people who are available are not trained on how to read and operate the calendar.
Proper calendaring using case management should also funnel into easy billing. Why you may ask? It is part of productivity. You want to make sure that if you are putting in the work to make sure you are meeting those deadlines, then you also want to make sure that you’re billing for it too. Some practice management software today have the capability to allow you to bill on the go, or enter time from the programs you’re already working in. For example, you can record your time as you save documents in Word or when you send client emails from Outlook.
Nobody should be able to opt-out of using a calendar because you want to maintain that accurate centralized firm calendar that is used not only consistently but in a uniform and standardized way. The workflow for each matter should allow everyone to know what step needs to be taken and when. This will lead to a higher level of firm efficiency, a higher level of communication, and as a result, higher client satisfaction.
Calendaring seems simple, and in part it is. But it also can be the difference between a malpractice suit and a profitable law firm. It is important to learn and train your team on best practices because although calendaring seems like a no brainer, you’d be surprised about how many firms struggle to keep their schedules buttoned up and organized.
To learn more about Centerbase's calendar, schedule a free no-obligation product demo!
The threat landscape for data security is incredibly vast. Today, law firms have the responsibility and duty of technological competence to ensure that their client's information is safeguarded and monitored.
The sad reality is that law firms are often the center of data attacks because of the type of sensitive information that is being dealt with on a daily basis. Often times, attorneys assume that their email or personal information is safe. This is a mistake.
Maybe unbeknownst to you, your personal information includes clues into larger portals of information that can then be categorized and cataloged for hackers to use to gain access to other sensitive information.
Crime today has been commercialized, and organized crime groups use tools to professionally infiltrate your information. The hacking industry now runs much deeper than someone sitting in their basement chugging a Mountain Dew, it has evolved into an illegal business that has cost firms and businesses billions of dollars.
Because of this, clients are no longer just paying for legal services, they are also paying to ensure that their data is protected. Today, class-action lawsuits can be brought against a firm for failure to safeguard and protect their client's information.
An attorney may be required to take special security precautions to protect against unauthorized disclosure of information or when the nature of the information requires a higher degree of security. So, for example, does everyone at your firm have access to the same information? Is it classified and compartmentalized across the firm? Is the data protected according to its sensitivity?
All of these things should lead you to question, are the measures you’re taking and putting in place strong enough to protect your client’s sensitive information?
At the end of the day, it's about organizing your information in ways that keep it safe and accessible to those who need it. Do you keep all your client files on one hard drive? Do different clients warrant a different type of security to access their files, are they cleaned up regularly?
The Association of Corporate Counsel (ACC) published model information and security controls that have been adopted almost nationwide as the defacto standard for attorneys to follow. Whether you have an IT team or not, it is your duty and responsibility to understand these measures and be able to act on them.
Let’s go through some of these together:
1. Understand your information
In order to protect your firm’s and your client’s information, you must understand what information you have. You must then classify and organize it, and then thoroughly document what you are going to do to protect it.
2. Review the rights and responsibilities
You’re either doing a good job and following best practices, or you’re not. You need to know what procedures you have or will have in place to secure what needs to be protected.
3. Physical security
Does your office and your third party vendor’s space utilize badges and door codes? If not, this is the easiest thing to quickly implement. You can also go one step further and store data in different access-based locations and create logical controls so people are only accessing the information they are authorized to.
4. Information disposal
What you do when you’re done with the sensitive information should be reviewed and documented with your clients as well. Are you giving their information back? Are you destroying it? Are you doing both? That needs to be outlined and made clear.
5. Monitor
Make sure your people and your vendors are doing what they’re supposed to be doing. Conduct vulnerability assessments, make sure your devices are encrypted, and know if something is open or publicly accessible. Encryption is a very basic security measure that your firm needs to be aware of and implementing (if you’re not already). Your information should be encrypted both at rest and in transit. For example, if you have an encrypted computer that gets stolen, you don’t have to report that because the thief cannot do anything with the information on the device. Yes, you'll be out an expensive piece of equipment, but your data will be secure. That is encryption at rest. Encryption in transit is the protected information that is being sent or received between devices like through email or text.
The most dangerous people at your firm are the ones who lead your IT team, but they are also the most helpful. This type of trust is a commodity. There must be controls in place to ensure that the work they have done is accurate and secure. If you do not have an IT team, you need to do your due diligence with your cloud provider or your third-party vendor and ensure that they are up to date with the latest security measures and you have records that they are constantly monitoring your information.
6. Insurance
You don’t know what you don’t know. Buy cyber insurance. Only 34% of firms have cyber liability insurance. Take the opportunity to limit your exposure because the cost of a breach will end up being significantly more than the cost to prevent it.
Now that you have all this information in place what do you do? You prove it. Take the time to get an industry certification or a privacy shield and be proactive to show your clients that their highly sensitive information is in good hands.
Third-party vendors constitute a lot of risk. Did you know that 60% of breaches are linked to third-parties? Even today, many firms do not adequately assess these relationships because they feel that their staff is well trained and will assume their vendors are too.
Let’s look at some numbers here:
32% of firms do not evaluate third-party vendor security.
60% of attacks come through third-party vendors.
And only 34% of firms have cybersecurity insurance.
So when someone asks? Why do we care? This is why. These figures are staggering. Even though you may have a buttoned-up security system, can you trust the third parties?
If you’re working with third-party vendors, you need to follow some basic steps to ensure that the work they are doing is not only correct but protected as well. Ask yourself:
As we discussed earlier because third parties are very susceptible to cyberattacks, clients are asking for assurance from their law firms and as a result, many of these firms are seeing an increase in information security and data governance audits coming from their clients. It is becoming more common practice to audit your third parties, both from the client and firm side because the risks of cyber attacks are so high. At the bare minimum, if you’re using a third-party vendor, make sure they are doing at least as good of a job as you are in implementing security controls. Do not assume anything because it is not if you will experience a potential breach, it is when.
You don’t have to be an IT professional to ensure that your firm and your client's information are safe! If you're using a third-party vendor to store your data, consider asking them these three questions…
1. How are you protecting my information?
This is an open-ended question for which the vendor should immediately answer by showing you their security policy documentation, standards documentation, and instant response plan. If they respond with something along the lines of that information being proprietary, you should raise concern. The best practice in security is always transparency.
Additionally, when you ask your vendor any questions regarding your data, pay attention to how they answer it, and take note of the amount of detail they give in their response. They should be able to tell you what they are going to do with the data, how long they’re going to keep it, and how the data is classified.
2. What are you doing with my information?
What infrastructure is your third-party vendor using? Where are they physically located? What class systems are their server hardware and firewalls? Using a third-party vendor is a lot of work because you need to do your homework and make sure that your information is secure. For example, look at their data flow diagrams, this will tell you all the buckets where your encrypted data sit at rest and all the paths they take between those buckets when they’re encrypted in transit. It is important to ask how they encrypt your information and the humans that are physically accessing that data at each point.
3. Business Continuity Plan
This is your backup plan! Some firms use Amazon Web Services (AWS) as a hosting vendor. Just last week, their system went down. Not for a few seconds or minutes, but for hours. The reason for this outage was undisclosed (scary!). Because of this, you need to know does your third-party vendor have an off-site disaster recovery location to allow for a quick transition? Ask to see what their uptime has looked like over the course of several years and if they have had a lot of impactful outages. Your job depends on being able to access your stored documentation and files. If you don't have access to what you need, you can't do your job.
Using third-party vendors may pose many avoidable risks. It is best practice to consolidate your tech stack and make sure you know exactly where all your data is stored. At all times.
When it comes to IT and your security, you need a strategy. You cannot hope things go your way, or hope a backup can be produced. Your clients expect nothing but excellence from you, you should expect the same from your vendors.
And if you remember anything from this blog, remember this- If you didn’t document it, it doesn’t exist and if you didn’t test it, it doesn’t work.
If you're still curious to learn more, check out our blog: Data Security for Law Firms: Everything You Need to Know
You can be the greatest law firm in your city or even your state, but lacking the necessary legal billing processes means your practice won’t be sustainable. Proper client billing is not a one size fits all approach – you must find what works well financially and work with a system that allows the flexibility needed to be efficient (without reinventing the wheel). There’s a major shift to cloud-based software for firms looking to get their bills out faster and to consistently generate more billable hours.
We’re going to walk you through the top legal billing features your law firm needs in order to account for the specialization and unique processes that go on in day-to-day billing. Chances are, you’re aware many of these systems must coexist, but you may not realize how to make them work together to effectively work for your staff.
From the moment a client contacts you to when they pay their last bill, a lot of things are happening behind the billing curtain that they don’t see. There are so many intricacies and steps that have to be taken to ensure the right bills go out to the right clients at the right time. Because of this, it’s important to have a solid standardized billing policy that is accepted uniformly across the firm. This policy may differ from firm-to-firm but consider including elements such as a timeline for pre-bill approval, a hard date for when invoices should be sent to clients, how the bill should be delivered to the client, and how your firm would like to accept payments.
You’re familiar with how it goes:
When going through all your features, ensure you’re transparent when presenting the billing process to clients. Not bringing up expectations on the cycle, billing method, payment timeline expectation, and stance on late payments can create lots of problems later when alignment isn’t there regarding a bill.
With that said, here’s what you need to have for a smoother, more efficient legal billing process:
While you may be accustomed to billing for work at an hourly rate, that may not be the best way to retain clients. According to the 2019 State of U.S. Small Law Firms Report, only about 60% of the day is spent actually practicing law – making generating billable hours difficult. It’s why having new billing strategies can help reevaluate the way clients are billed, and how to add more time back in everyone’s day with revenue-generating activities versus client onboarding or administrative work.
Depending on your area of law, if you’re representing a single person, a contingent fee or flat fee may work better for clients’ needs.
Consider all methods of billing, such as:
For each attorney at your firm, there may be rate adjustments due to tenure and other experience. For the ability to fluctuate between them, rate tables are one of the most useful features to staying agile around billing.
Some software today allows you to configure your rate tables around the matter, client, system default, and timekeeper. Not two matters are the same, and the work you provide per case is not cookie cutter. Because of this, it is important you have the ability to change your rates and make one-off exceptions on services that may not be standard billing protocol. At the end of the day, rate tables should be as flexible as you are.
Learn more about how Centerbase uses rate tables to manage rates from multiple users seamlessly
If you ask someone on the billing team how many times they've been asked to print out a client bill or bill payment history, you can bet that you'll probably be met with an eye roll and a chuckle. Clients can be relentless. They want hard copies when you don't have them and they want electronic copies when you have paper.
Providing your clients access to a secure billing portal will take some strain off your billing team and allow your clients 24/7 access to view, pay, and download their bills. The job of a billing portal is to increase visibility into what is due and make it easier for clients to review and pay their bills. Additionally, this increased visibility will allow your clients the ability to find answers to their billing questions on their own before calling in for support. This way, your clients get what they want, and you have peace of mind knowing that you have provided them with a solution to all of their possible requests.
It's no secret that clients don't always pay on time, but the fact of the matter is, your client's actions shouldn't influence your firms. The more consistent your firm is about sending bills, or having them readily available to view will help create a level of consistency where your clients will soon grow to expect to see your bill and pay them more regularly.
In 2020, most people are texting. Compared to ten years ago, people actually prefer to text with businesses vs communicate with them through email. Not only does texting elicit faster responses, but it is much more convenient. All of this sounds great, right? Well yes, but what about for attorneys? Your time is precious, and although texting your clients may be easier for them, how do make it easier and more profitable for you? If your clients are mostly texting, and you spend hours responding to their messages on the train, at home, or on the go, you have to have a way to track how long you communicated with them for. Otherwise, you are losing thousands of dollars each month.
Today, an agile law firm has the ability to capture the time spent sending messages or making phone calls. This mobile timekeeping feature is incredibly important to not only capture more billable time but also eliminate the manual work of logging it after a conversation. The goal is simple: provide better, top of the line client services while increasing your billable hours.
You can substantially improve your firm’s cash flow by having a simple, easy-to-follow approval process for everyone involved to send out invoices more efficiently. With electronic pre-bill approval as a feature, you can create a single or multiple step approval process, and flow a pre-bill up the approval chain. What this allows you to do is move a single bill from one attorney to the next once it’s been approved. You can keep track of every change and edit through electronic records and ultimately you'll relieve pressure on your billing team by having the attorneys make mark-ups directly to the bill.
For example, this is how it works in Centerbase:
For billing insights and monthly reports, having everything in one place is an excellent resource to make informed decisions about your firm’s financials. With robust legal billing software, everything from matters, billing, and accounting data can be viewed in custom reports that suit your preferences and needs.
All the legal billing features mentioned in this blog are made possible with the right practice management software. While many firms are continuing to move to the cloud in this new world of remote work, it’s important to choose the right software that meets your needs and everyone’s in your firm. This includes steps involved to get onboarded and what should be imported into your new legal billing software.
Are you ready to step into the conveniences and revenue-generating abilities of cloud software? Then let’s talk. You’ll love seeing what Centerbase can do – all at no obligation to you. Contact us today and let’s talk.
Although eBilling may seem intimidating if you have never done it, there are ways to make the adoption easier. You may have questions if you’ve never done eBilling, or if you’re thinking of taking on a client that relies heavily on an electronic billing system, but don't worry, we have some tips on how to make this painful process a little bit easier.
eBilling, summed up, is electronic billing for your clients, so your billing department doesn't have to send invoices through the mail. This makes transactional payments for matters easier – especially in a COVID-19 world where in-person contact is made to be limited.
Many guidelines have been put in place for law firm billing procedures for standardization and convenience for your billing staff. The nice thing about establishing eBilling as a precedent is that it helps avoid errors earlier on in the legal billing process. There’s no more re-typing or manually generating invoices with eBilling – as you can program what in-house can enter in as a bill against invoices outside counsel sends for payment.
System parameters such as checking for budget limitations or accidental duplicate entries can be caught before it’s officially submitted on a matter. The same can be said about bundling bills, which can create confusion when processing and understanding what’s being paid for.
This one-time implementation of eBilling in practice management software (or combined in a software solution you may already be looking at) helps put a stop to rogue charges that are difficult to track.
Using a preconfigured billing system, outside counsel will need to submit a digital form detailing what the charge(s) for clients are in that cycle. Then, the eBilling system typically accepts and generates an invoice and ensures there are none of the aforementioned parameters that can occur due to human error before going to the in-house team to evaluate.
The best value for implementing eBilling? Data insights. You can automatically capture data insights and ensure your matters don’t exceed the budget for certain services from outside counsel. All of this can be configured into the system so it automatically sweeps for this every time.
For many of the reasons stated above, firms love the convenience of sending electronic bills for the quickness and added accuracy from the settings. Having a simplified invoice review process makes managing budgets and keeping track of where your billing is at during any given time is a huge convenience many firms have already switched to and reaped the benefits.
Read more: Key Demands for Your Next Cloud-Based Law Firm Billing Program
With eBilling, there are no more wasted ink or duplicate bill prints. With legal billing software, you can make markups and approvals for bills directly in the software. Having trackable comments and feedback also ensures those extra copies and notes don’t get thrown in the trash in lieu of the newest, most updated copy. No one misses anything, and that multistep process gets whittled down to smooth, easy sailing.
Because you won’t have to print pre-bills, the multiple rounds of approvals can be completely eliminated. That single pre-bill can be moved up the approval chain, with the software automatically tracking it to the next person needed to see once it’s approved. This relieves pressure from your billing team to have to track anyone down or clog the inbox with reminders.
Electronic records will always be kept of any notes attorneys make on pre-bills, making it easy to go back into the software to check anytime. This is especially useful if someone is out of the office or an attorney has left, who may have taken tribal knowledge with them on a certain client matter or bill. With extra visibility comes increased alignment from all departments.
There’s no getting around it: eBilling has boosted efficiency and accuracy in law firms, all while saving time. By getting bills out more efficiently, clients have more time to review and pay their bills, keeping everything neater than before. At Centerbase, we’ve been able to help timekeepers at firms get bills out 30% faster – creating more room for firm-wide improvements that generate revenue and maintain a “work smarter, not harder” mindset.
Interested in learning more based on the question “What is eBilling?” Some systems sell eBilling as a separate offering that can be on-premise or in the cloud. But while that can offer customization, it won’t integrate seamlessly with any existing software or outdated systems you may currently be using.
You can prepare to move to eBilling with a few simple steps:
Read more: 5 Questions to Ask a Legal Practice Management Software Vendor Before Purchasing
Cloud-based practice management software and eBilling are packaged together with Centerbase, which means you only have to worry about one software for everything vs. a la carte options. We’ve helped thousands of firms implement solutions that work with their team, and not against them.
We encourage you to read more into how you can integrate eBilling into everyday processes sooner than you think, and hope this has been helpful. Feel free to subscribe to our blog or check out our resources page for more content.
