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How healthy are your legal practice’s finances?

How healthy are your legal practice’s finances?

By LIV Professional Development

Continuing Legal Education Finance Practice & Procedure Practice Management 

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Organising the finances in your legal practice doesn’t have to be a headache. All you need is the right knowledge. Here are some simple tips to get you and your firm on the path to financial health.


It’s important your practice has regular financial check-ups to ensure it is fighting fit. Controlling your finances is an essential part of good business management. We’ve asked Brent Szalay, managing director of SEIVA, for three easy and practical ways to maintain your financial health.

Design a financial model

The best way to get your finances on track is to design a financial model. Begin with the end in mind­– where would you like your business to be in three to five years? Plan the outcome you want to achieve and then break it up into smaller, easier to manage steps. Keeping steps small and achievable will keep you and your team motivated. It is important to tailor your model to your specific requirements and be realistic. Research some similar firms and benchmark your figures and progress against them.

Risky business

Taking risks in business sometimes pays off. However, taking unnecessary risks can be detrimental to your firm’s financial health and stability. It’s critical to be aware of risks that may impact your business and being able to identify potential future risks is an essential part of responsible practice management. Before making any large financial decisions be sure that you have all the information. Evaluate your cash cycle and your profit margins, and plan at least six months ahead to avoid any nasty surprises in the future.

Keep track of your progress

It’s often tempting to ignore a less than satisfactory result. If it is a lower than projected outcome in profits, there’s a feeling of panic. It is so important to keep accurate financial reports. Establish a reliable and consistent financial reporting process as early as possible and dedicate time and energy to maintaining a structured approach. This is the easiest way to track your progress and growth. Remember that integrity is key – otherwise you’ll just end up wasting time and risking harm to your business in future. 

Maintaining financial health will depend on staying accountable to the systems you put in place. For more information on establishing greater financial control, read Brent Szalay’s full article ‘7 Steps to Success’ in this month’s LIJ: http://bit.ly/2z92mFS

Want to find out more? Register now for the LIV’s Practice Management Course and equip yourself with knowledge of financial management as it relates to the law practice, including accounting fundamentals, budgeting, taxation strategies, billing and debtor control and more. Register here:http://bit.ly/2gMdPRs

 


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