Administrative tasks like billing and invoicing can be huge time suck if not done efficiently. That’s why it’s so important to have streamlined processes in your law firm that: 1) reduce the repetitive tasks associated with tracking and entering billable time, 2) simplify the invoice creation process, 3) make it easy to send invoices to clients, and 4) standardize the steps required to accept, receive, and account for payments.
Creating an efficient invoicing workflow in your law firm may seem like a daunting task, but rest assured, it’s an attainable goal. Not sure where to start? Here are some ideas to implement that will get your firm on the path to a streamlined legal billing process, ultimately saving lots of time and resulting in faster client payments.
Make it easy to track time
For lawyers who bill by the hour, time is money. That’s why it’s so important to make it easy to keep track of billable time, whether it happens in the office or in the courtroom.
For starters, make sure that lawyers in your firm are able to track their billable time using multiple timers and enter billable time no matter where they happen to be, whether in your firm’s desktop case management software or on a mobile device. Another way to increase billing efficiency is to simplify the steps needed to convert billable activities into billable time on an invoice. Oftentimes, the billing software that your law firm uses can accomplish this goal in any number of ways. For example with the click of a button you can convert events or tasks into billable time. Another timesaver is the ability to take advantage of default billing activity descriptions when entering billable time. The easier it is for your attorneys to create a time entry, the more likely they are to do it.
Simplify the invoice creation process
Before the advent of electronic billing, creating and sending out paper invoices used to be time-consuming process. Fortunately legal billing software has changed that and nowadays it’s easier than ever to generate legal invoices quickly and then immediately send them to clients electronically.
There are a host of ways to reduces legal billing inefficiencies, but one of the easiest is to reduce the number of steps needed to create and send out invoices. One way that legal billing software accomplishes this goal is by automatically providing necessary billing information, such as LEDES billing codes. Additionally, the built-in ability to customize invoices allows you to easily determine what information appears on your firm’s invoices, such as which time or expense entry columns you would like to appear on an invoice. For example, with the click of a mouse, you’re easily able to remove all time entries during the invoice creation and generate an expense-only invoice.
Automate invoice reminders
Another way to improve your law firm’s legal billing process is to use software that allows you to set up automated invoice reminders. With this built-in tool, you can schedule reminders when you send out the very first invoice to a client. If the invoice isn’t paid, a follow up invoice will automatically be sent to the client, reminding the client that the billed amount is still outstanding.
This convenient tool will save your law firm time and money. The initial invoice needs to be sent just once; after that, the software follows up with your client. No need to waste time re-sending the invoice manually. The system does the work, ensuring that your law firm is paid in a timely manner.
Allow clients to set up payment plans
Another way to get paid quickly is to allow your law firm’s clients to set up payment plans for their legal bills. By doing this you provide your clients with increased flexibility, making it easier to pay large legal bills.
The simplest way to do this is to use your firm’s legal billing software to set up a payment plan using the built-in payment plan features. You can create the payment plan, establish the amounts due and due dates, and share that information with your client, who can then instantly pay via e-check (ACH0 or credit card using your firm’s legal billing software with built-in online payment tools You can then set up invoice reminders for the amounts due, as discussed above. That way, your client has all the information needed to make regular payments under the payment plan, and will receive convenient reminders when the payments are due.
Utilize advanced billing and revenue reporting features
Finally, ensure that your law firm’s billing process is as efficient and effective as possible by tracking and analyzing your firm’s financial and billing information. One of the best ways to do this is to run reports that provide you with an overview of your law firm’s billing, invoicing, and collection data. Depending on the software you use, you may have the following types of law firm reports available to you:
- Aging Invoice Report: A report will of overdue balances grouped into 1-15, 16-30, 31-60, and 61+ days overdue.
- Accounts Receivable Report: A report detailing your law firm’s receivables, which can be filtered to show a particular client or case; you can also choose various grouping options to better format the data for your law firm’s specific needs.
- Case Revenue Report: Shows cases billed during a certain time period and allows comparison of monies earned on those cases during that same timeframe.
- Fee Allocation Report: Displays amounts billed and collected by specific users at your firm during a certain time period.
- User Time and Expenses Report: Provides time and expense entries for a particular employee of your firm.
- Case Time and Expenses Report: Provides time and expense entries for a particular case/matter.
- Trust Account Summary Report: Shows all contacts with trust balances, including total credit, total debits, and “as-of” balance.
- Trust Account Activity: Displays a chosen client’s trust account activity.
- Non-Trust Retainer & Credit Account Summary Report: Provides an overview of all contacts with non-trust retainer & credit balances as of a specified date.
- Non-Trust Retainer & Credit Account Activity Report: Shows a client’s non-trust retainer & credit account activity.
- Case List Report: Displays cases based on case status (open/closed) and practice area, and you can also group cases by practice area, firm user, client, and fee structure.
- Statute of Limitations Report: Shows pending and expired statute of limitations deadlines for all firm cases, or those assigned to a single attorney.
- Electronic Payments Report: Shows all payment activity made via eCheck and Credit Card within a specified time frame.
- Credit Card Fees Report: Offers a detailed view into which fees taken from the Operating account.
Does your firm run any of these reports? What about the other legal billing tips? Does your law firm already take advantage of any of those time-saving ideas? If not, which ones can you implement today to improve your firm’s legal billing process?