Overview
If you are looking at setting up your own practice after practising in a large law firm, the financial aspects of running a law firm may not be an area that you would have paid much attention to. Like many lawyers, the financial aspects of running a practice is most likely not an area that you are inclined towards.
While some lawyers prefer to take a hands-off approach to the financial aspects of running a firm, we would strongly encourage the partners in a firm to take an active interest in the key financial aspects of running a firm, including:
- Compliance with regulatory aspects of financial management, particularly compliance with Solicitors Account Rules, GST and tax compliance.
- Are the bookkeeping arrangements satisfactory, from the perspective of i) timeliness; ii) risk associated with outsourcing arrangements, including client confidentiality and loss of of source documents
- Are there sufficient checks and balances to guard against technical client account breaches, client account defacations and office account fraud?
- Are there good practices in place to minimise cashflow risk: eg disbursement tracking, regular billing cycles, invoice collection workflows;
- Have you established a good working relationship with your auditor and tax agent?
- Are you able to reliably and immediately assess up to date information relating to file related transactions eg: WIP, unbilled disbursements, billed disburements, invoices issued, unpaid invoices; payments received?
- Are you able to generate financial reports that will assist you in analysing your firm’s performance meaningfully, beyond its profit and loss and balance sheet?
- Tax plannning and reporting
Aside from engaging a reliable and experienced law firm bookkeeping (be it full time or part time arrangements), we would encourage new firms to put in place a good practice management system like LEAP Accounting right at the outset (and not 2 years down the road) for the following reasons:
- It is cheaper to put in place a practice management system at the start, when you do not have to deal with legacy data and are starting off on a clean slate.
- A practice management system like LEAP Accounting, will help you to comply with the Solicitors Accounts Rules, and to manage your financial transactions much more efficiently and accurately.
- There are government grants available to assist new law firms in subsidizing the implementation of a practice management system.
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How We Can Help
The Bizibody bookeeping team has over 25 years of bookkeeping and business experience. We undertake accounts set-up and bookkeeping for law firm clients in Singapore to ensure compliance with the strict regulatory safeguards for lawyers handling client funds under the Solicitors Accounts Rules.
In order to accommodate the needs and budgets of our clients, we offer a range of different bookkeeping options. These include insourced onsite bookkeeping arrangements where dedicated staff will write up your books at your office so that you need not send your source documents to our office.
