Are you on top of your financial records? Here are some reasons why you should be!

The importance of accounting for your business

A successful business keeps accurate financial records. This means you know how commercially viable your business is and what challenges need to be overcome. Knowing and understanding your financial position gives you the opportunity to develop genuine strategies to meet these challenges. Simply put, how can you grow your business if you are not tracking where your money is going?

Knowledge of accounting principles and the ability to analyse financial well-being is a critical, yet often neglected aspect of a law practice. Accurate and efficient accounting practices and procedures are the foundation of any profitable business. In operating a law practice, there are several important areas to be confident in administering. 

Financial literacy

Take some time to learn the language or accounting jargon and what it all means. By knowing how to speak and understand accounting, it will help communicate effectively with others that are key to the function of your business. This could be your bookkeeper, accountant, ATO, your employees or your clients. 

Being financially literate will also make you better able to detect and rectify any potentially suspicious or questionable reporting practices occurring on your behalf. Don’t immediately trust others to know your business better than you do!

Capturing disbursements prior to billing

Ensure you are not too eager to bill your clients without properly recording sundries and disbursements. Matter related sundries and disbursements are often overlooked or forgotten by the time a matter is completed. These out of pocket matter related expenses can amount to thousands of dollars over a period of time. If overlooked and not correctly reimbursed by the completion of a matter, the principal bears this expense, meaning the principal or law practice is funding the client's matter from their own pocket.

Utilising financial and management reports

Making use of various financial reports is extremely beneficial in determining your financial status. The generation and utilisation of management financial reports, gives you a general understanding of your law pratice's performance, effectiveness and efficiency. The ability to analyse and question these reports and information is necessary to being able to make informed changes to your operations, plan for the future and make informed decisions based on accurate forecasts.

Knowing your responsibilities

It must be noted that a law practice operating with a trust account should operate with compliant and accurate systems, as trust accounts are subject to audits and must be correct. The Legal Profession Uniform General Rules (2015) govern how a law practice handles trust money. 

Along with being a business owner operating your own practice or firm, you may also be an employer. Therefore, you are responsible for your employees being paid the correct salary. You should also be familiar with your STP payroll obligations.

Getting the most from your accounting software

Having good financial practices and processes as well as an understanding of accounting principles is the biggest determining factor in securing growth, generating profit and achieving overall commercial success for your business. With our long standing industry knowledge, ATOM was designed specifically with accounting solutions for the Australian legal industry at its core. 

It is our aim to simplify the accounting function that can prove overwhelming and time consuming to a sole practitioner or small law practice who might not have the resources to engage a full time accounts department. ATOM is also completely scalable to support your law practice as it grows or to assist existing larger-sized firms.

Trust accounting and controlled money

Certified by The Law Society of New South Wales under the The Legal Profession Uniform General Rules (2015), ATOM contains a completely compliant trust accounting platform servicing sole practitioners and law practices of all sizes across Australia. It’s trust accounting functionality makes the preparation of monthly regulation trust reports simple. 

As controlled money accounts are also subject to regulation, ATOM is also certified to record all controlled money movements from within the matter.

General accounting 

ATOM is an integrated system designed for complete financial management. There is no need to link with any other external accounting programs that would have you paying for their subscription fee too. This means ATOM can handle all of your general accounting in addition to your trust accounting needs.

ATOM affords you the ability to generate a number of crucial financial reports. Using ATOM, you can generate income and expense reports, balance sheet, GST reports and detailed general ledger reports. Once generated you can view these reports online, export to Excel or PDF. 

The Management reports allow you to track fee earner performance, manage debtors and monitor cash flow with ATOM’s sophisticated suite of management reports. These reports ensure you are tracking your law practice’s KPIs and maintaining your fee earners productivity.

Using ATOM, you can also easily record and track matter related sundries and disbursement to ensure all out of pocket expenses are captured when creating an invoice to your client.

Financials dashboard 

The full Financials Dashboard provides an ‘at-a-glance’ financial analysis of fees recorded, billed and cash receipts. In addition, your fee earners can utilise the Fee Earner Dashboard enabling them to track their own progress. 

Time recording and billing

ATOM also records time spent on a matter each day at a fee earners rate, enabling you to generate an itemised bill of costs. Alternatively you can use a fixed fee method to generate a detailed invoice at an agreed cost. You can easily create an itemised bill of costs and email directly to your client from within the matter.

Payroll

If required, ATOM allows you to add in an STP approved payroll function that is compliant with all government regulations. ATOM’s payroll ensures you accurately record employee payments, deductions and contributions for PAYG and superannuation.

Want to know more?

Our aim is to alleviate the stress and expense associated with the accounting function by providing a cost effective online service that automatically updates, includes multiple daily backups and allows law practices to focus on what they do best.

If you want more information or would like to know how ATOM can help you get your financial records in order, visit our contact page.