Today small law firms face many financial-related obstacles that impede their growth and ability to provide a better service.
These issues may include
- Difficulties with payroll and salaries
- Partner profitability
- Financial statements
- Malpractice insurance
- And trust accounting
As you know, dealing with all of these issues can take up a lot of paperwork and time. Is there an easier way to get around these accounting issues? The answer is yes, and it’s called outsourcing.
Now the question is, should your small law firm outsource its accounting?
Today, we will cover all aspects of this question. Let’s get started!
What is Outsourcing All About?
Outsourcing can be a cost-effective and efficient solution to delegate tasks that take up so much of your valuable time. One of the best examples of outsourcing is accounting and bookkeeping. Lawyers should focus on what they are good at, and that’s working towards winning their clients cases in court.
It’s not uncommon for law firms to hire a local part-time bookkeeper to keep records and bank statements in order.
But now, there is another option to outsource your accounting and bookkeeping tasks to a virtual company, one that specializes in working with law firms specifically. And they may not even be in your same state.
All of this is easily done when you move your accounting to the cloud, and use software such as Xero.
What is Xero?
Xero is cloud accounting software that works particularly well for attorneys since it integrates flawlessly with third party software such as “Cilo”, a practice management software used by attorneys.
Since Cilo tends to be popular among lawyers and their law firms, Xero is a natural fit. The integration allows:
- Client expenses to automatically reflect as an invoice in Xero
- Paying invoices is a cinch. Any time an invoice status is updated in Clio, it is updated in Zero.
- Seamless accounting means you do not have to sweat the minute details. Update a record in Clio, it’s now updated in Xero.
This integration will save you and your team a lot of hours. No more exporting or copy and pasting data, it’s just done.
Even if your law firm doesn’t use the Clio software, you still can benefit from using an outsourced accounting partner, who can have all of your accounting done in a timely fashion.
What to Look For When You Outsource Your Accounting
You should expect to find, a good accounting firm that will provide professionalism on all levels. A top-notch company will offer multiple services that revolve around accounting such as payroll, HR, bill payments, and tax services.
Look for accounting companies that offer:
- GAAP Accounting Services
- Bookkeeping Services
- Tax Management Services
- Human Resources Services
- Reporting Services
- Cloud Services (Xero)
- Trust Accounting Services
So, should law firms outsource accounting? As you can see, it can be an excellent solution to the countless hour’s of paperwork headaches.
If you do choose to eventually outsource your accounting now or in the near future, make sure the firm offers the services you need and really understands your business.