Reasons to Choose Outsourced Bookkeeping Services for Law Firms

Accounting is a crucial part of running any business, including law firms. If you do not manage your finances properly, your law firm might face difficulties. Studies reveal that poor financial management often leads to the downfall of legal practices. Unfortunately, many lawyers who start their own solo or small practices make the mistake of handling accounting and bookkeeping on their own. This happens for various reasons. Some underestimate the importance of these tasks, some hesitate to gain control, and some fear the cost of outsourcing. 

But let us debunk these misconceptions: 

First, bookkeeping and accounting are the lifeblood of a business, and their significance cannot be overstated. 

Second, successful business leaders build teams of experts. Unless you are both an accountant and a lawyer, you probably lack the accounting expertise your firm needs. 

Lastly, outsourcing bookkeeping tasks to bookkeeping services for law firms comes in various price ranges, and the savings from proper accounting far outweigh the investment. 

Reasons to Choose Bookkeeping Services for a Law Firm 

With outsourced bookkeeping and accounting services, law firms benefit from access to a team of professionals focused on keeping your financial records in order. It may feel uncomfortable at first to give up this bit of control, but an experienced service provider offers priceless benefits.  

The right professional has advanced knowledge of the legal industry’s tax structure, so they can offer advice that specifically speaks to your firm’s interests. They may also help you make strategic financial decisions about the direction of your firm. 

It is hard enough for law firm leaders to keep updated about all the new legal technologies. Why add accounting tech to that list when outside accounting services have a pulse on the latest services and technology available within their industry? Since this is the center of their business structure, these professionals are more likely to utilize technologies and equipment that promote the highest standards. Just think about the frustrations that you may have experienced trying to manage your law firm’s finances through QuickBooks. When armed with only the basic skills and knowledge of the software, you can quickly run into problems that you do not know how to handle. External accounting firms have access to the latest software offerings, and the skill needed to achieve the best results from them.  

Especially within a law firm, any hour spent on administrative tasks is an hour not spent on a billable client task. The average small business owner reportedly spends at least 10 hours a month on their business accounting needs. Let us say your hourly rate is $250. That means that you could be spending more than $2500 a month on accounting tasks. Surely, you can find a reputable accounting firm for far less. You may not want to spend any of the firm’s dollars on bookkeeping and accounting services. However, when compared to the cost of hiring a full-time accountant, or the collateral costs of inadequate DIY accounting, the investment is negligible. By choosing to outsource accounts receivable, your firm only pays for the services requested. 

As your law firm grows, the skill required for adequate accounting also grows. What you may have been able to handle when the practice first started has probably become much more complex. You are now more susceptible to devastating financial errors. Outsourced accounting and bookkeeping services for law firms minimize these risks. Just as you dedicate yourself to protecting your clients from legal harms, professional accounting services dedicate themselves to protecting their clients from financial harms – especially as your firm expands. 

Outsourced accounting services let you and your staff stay focused on what matters the most – providing stellar legal services to your clients. Yes, it is important to maintain awareness about the financial health of your firm, but outsourcing allows you to do that without taking up unreasonable amounts of your time. The legal industry is crowded and need proper financial flow for better functioning. To stay competitive, you need to consistently identify strategies for staying ahead of the competition. This means focusing on areas like client retention, service expansion, and marketing. It does not mean spending hours and hours each month trying to figure out bookkeeping and accounting. Time spent on accounting is time not spent on the other crucial aspects of running a successful law firm. By outsourcing the accounting to a trusted professional, you and your firm members can dedicate more time to building your law practice, while feeling secure that the finances are being managed by skilled accountants.  

It is no secret that the practice of law comes with a lot of stress. As an attorney, you need systems in place that make your work life easier and promote a healthier work-life balance. Outsourced accounting is one of those systems. Running a law practice takes a lot out of you but outsourcing your firm’s accounting and bookkeeping can lessen some of the stress you may feel about such an important part of your business. 

Conclusion 

Outsourcing bookkeeping services for law firm is a wise decision. It provides your firm with a dedicated team of professionals who understand the legal industry’s financial intricacies, ensures you have access to the latest accounting technologies, and ultimately saves you time and money. This support allows your law firm to focus on providing exceptional legal services, supporting firm growth, and reducing the stress that often comes with managing finances. In a competitive legal industry, outsourcing your accounting needs is a strategic move that can contribute to the long-term success of your firm. Do not underestimate the value of professional bookkeeping services for your law practice.