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5 Essential Practice Management Reports for Small Law Firms  

Posted by: Frank Strong January 12, 2015 in Small Law 3 Comments

5 Essential Practice Management Reports for Small Law Firms

A recent survey of 309 small law firm billing practices in the U.S. found that about 80% use software for legal billing. That’s great news and as a legal technology vendor we are, unsurprisingly, big advocates of using software.

About 67% – still a wide majority – say this software is “legal specific software” meaning it was designed for law firms. Again, we think this is smart law firm decision making; bear with us, there’s a point (and some tips) coming.

Finally, another 65% said their software had integrated accounting and billing and then came the derailment:

Do you or does your firm analyze client billing to identify trends and themes among clients in good standing or root cause analysis among habitually late paying customers?

Seventy-two percent said “no” in response to this question.

In their own words, small law firms openly admit that law firm billing and collections are a challenge – and while most already have software that can help solve this problem, the majority aren’t using the features and functions to solve the business pain point.

What Billing Reports Should Law Firms Run?

What reports should law firms run?  In an article in Legal Ink Magazine titled Decoding Attorneys Discomfort with Client Billing our own James Paterson suggests these five reports:

1. Time-to-pay. Identifies which clients or types of clients are fastest to pay invoices.

2. Outstanding accounts receivable (AR). Analyzes which clients, or types of clients, have bills outstanding and for how long.

3. Time tracking analysis. Comparing work invoiced vs. actual work performed (this is useful for understanding the profitability of a flat fee).

4. Client profitability. Distinguishes which clients and what types of cases are most profitable.

5. Top clients. Characterizes a law firm’s top clients by fees billed vs. fees collected.

 * * *

What reports – or process even – would you add?  Please feel free to share in the comments.

If you enjoyed this post, you might also like:
5 Solid Tips on Law Firm Billing and Invoicing 

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About Frank Strong

Frank Strong
Frank Strong is the communications director for the LexisNexis software division located on NC State’s Centennial Campus in Raleigh. In this capacity, he leads communications efforts in support of software products for law practice and law department management and also litigation tools – across large law, small law and corporate counsel segments. With more than 15 years of experience in the high-tech sector, Strong previously served as director of public relations for Vocus, which developed marketing, PR and media monitoring software. He has held multiple roles both in-house with corporations, ranging from startups to global organizations, and has also endured the rigors of billable hours, having completed gigs at PR firms including the top 10 global firm Hill & Knowlton. A veteran of two year-long deployments, Strong has concurrently served in uniform in reserve components of the military for more than 20 years, initially as an enlisted Marine and later as an infantry officer in the Army National Guard. Strong holds a BA in Film and TV production from Worcester State University, an M.A. in Public Communication from American University, and an M.B.A. from Marymount University. He is a PADI-certified Master Scuba Diver and holds a USPA "B" skydiving license.
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Steve Miller JD
Steve Miller JD

Frank, as you well know, LexisNexis PCLaw® is the #1 Time, Billing and Accounting Software program for law firms. Firms with as few as 2 lawyers and as many as 100 can use over 4 dozen different Reports to analyze the firm's business and to automatically generate scheduled Invoices, Past Due Notices and even Collection letters. For larger firms Juris® can perform deep-dive analysis of income and clients.The Time Matters® document merge function even generates Retainer Agreements with appropriate terms and conditions.

With so many choices available to firm administrators today it does not require a lot of effort to maintain a law firm's financial health.The Top Five Reports James has listed are available in each of these LexisNexis products.

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  1. Links We Love Weekly Round-Up — January 19, 2015 | Charlotte Law Blog says:
    January 19, 2015 at 7:02 am

    […] 5 Essential Practice Management Reports for Small Law Firms […]

  2. Law Firm Reporting is More Than Financial Reporting says:
    June 3, 2015 at 1:30 pm

    […] of LexisNexis, whose Business of Law Blog is one of the best legal blogs around, recently posted 5 Essential Practice Management Reports for Small Law Firms. Of the 5 reports listed, they are all billing reports. This represents a tendency that I have seen […]

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