A National List law firm member had a costly experience that you might be able to learn from and prevent within your own firm. This large retail law firm informed us that they had hired a new bookkeeper a couple of years back, and they just realized that the new bookkeeper was not billing clients for court costs. Thus, the firm was out thousands of dollars.
The firm contacted the clients that were not billed and asked them to please pay for costs incurred during that time period. Many clients were not happy, as this was an unexpected large expense they had to somehow fit into their budgets. Some clients paid the firm in full, some paid the firm over a period of several months and some refused to pay the firm at all.
As a result of this incident and other similar incidents, several companies added a clause to their legal forwarding agreement that required law firms to bill them for court costs within 90 days or they would not get reimbursed.
One possible preventative “tool” we recommend is CoreVision Strategies (CVS). Their services help law firms concentrating in debt collection and bankruptcy matters to establish best A/R practices.
Trained accounts professionals
More and more law firms are recognizing the need to obtain the assistance of trained accounts receivable professionals. From review of invoicing policies and procedures to collections, CVS provides a full range of receivables management services.
CVS co-founder, Martin Hali, has over 25 years of experience in account receivables management. He has actively participated in the Institute of Management Accountants, the world’s largest organization for management accountants and financial managers. He served as Director of the Institute, among other positions. He has also held numerous positions a in the Commercial Law League (CLLA) and the Commercial Collection Agency Association (CCAA). Over the past twenty years, Mr. Hali has written articles, filled speaking engagements and conducted workshops related to A/R practices.
Financial support services
CVS offers financial support services related to accounting, accounts receivable management, auditing, credit risk management, collateral monitoring, receivables solutions (including portfolio liquidations), due diligence, field examinations and more. Its clients consist of financial institutions (banks, factors), public and privately held international and domestic companies, law firms, accounting firms, investment and private equity firms.
Policies and procedures manual
When requested, CVS will review your existing policies, procedures, processes, staff and systems capabilities to determine what changes need to take place in order for your firm to obtain the desired results. Their objective is to create a workable policies and procedures manual that make sense and will be adhered to. Areas they consider include:
- Timely and accurate recording and billing of Time-and-Expenses per client
- Proper application of payments
- Follow-up and collection of delinquent accounts
- Training of staff, and provisions for temporary staff, as needed
To learn more about how a relationship with CVS could benefit your firm and help prevent loss from poor A/R practices, visit their website, www.corevision.com, or contact Martin H. Hali by:561-953-4651 (Direct) 917-328-4733 (Cell) 561-526-7799 (Fax) Email: Mhali@corevision.com
By Nancy Lender