Rethinking financial management for law firm growth
In the final instalment of 2024“Grow Your Firm” series, Matt Schlyder from FWO Chartered Accountants challenges one of the biggest misconceptions in law firm financial management: that fee earners should be in charge of billing.
Why discretion kills profit
“Giving fee earners discretion over billing is one of the biggest profit killers in law firms.”
When lawyers decide what to bill and when, emotion often overrides financial logic. They fear client pushback, undervalue their work, and delay invoicing, even when the client expects a bill.
The result? Unpredictable revenue, lumpy cash flow and reduced profitability.
Clients expect to pay
Most clients have already engaged your firm through referral and signed a cost agreement. What they value is clarity, professionalism and timely billing, not surprises or delays.
How to fix it
To build predictable revenue and profit, billing must be treated as a finance function, not a legal one:
- Align billing with cost agreements and use non-discretionary triggers (monthly, staged, or deferred).
- Auto-generate draft invoices based on WIP.
- Remove billing responsibility from fee earners completely.
This is where tools like MiNumbers can make a big difference. MiNumbers connects payroll and practice management data to provide dynamic monthly reporting on fee earner performance, including how much of their time is being billed.
The payoff
Firms that take this approach consistently see stronger cash flow, fewer debtor days and increased profit. Often 15–20% uplift, while freeing fee earners to focus on legal work.
FWO Chartered Accountants are strategic financial partners for law firms, combining deep legal industry expertise with real-time insights through MiNumbers to help firms grow with confidence.
Want to see how MiNumbers can transform your billing and profitability? Email me at matt@fwoca.com.au or visit fwoca.com.au
