The financial lifeblood of any law firm is receivables - the bills that firms send out to and collect from clients for work done. In addition to the traditional challenge of collecting receivables, two new dimensions have been added by ongoing trends spawned in the Great Recession: partner de equitization, and law firm bankruptcies.
Before a partner is de-equitized or otherwise terminated, the firm should understand what that partner's amounts are in receivable, and know how much they depend on the partner to bring in the receivables. Ensure that there are incentives for the partner to collect the receivable before he or she leaves and finds a home elsewhere. Addressing this issue should cover:
Make certain that time sheets are current.
Send billings to clients immediately even if the totals are off or need adjustments later.
Monitor payment history of the partner's client and exert special effort on the partner to ensure that final invoices are sent out.
Ensure that clients pushed for payment cannot claim negligence by the departing lawyer.
Communicate with the client if payment is not received promptly.
Please see full article below for more information.
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