Law firm accounting is important. While law firms require heavy client-focused work and require hours of your time dedicated to the needs of each individual case, the planning, structure, and financial management of your practice is just as important, if not more so. The business strategies and accounting practices you undertake are a crucial part of building and growing a thriving law firm.
Your clients should always come first, of course. But while your attention is on them, who is giving the growth and management of your firm the scrutiny it needs? From benefit plans and staffing concerns to the financial paperwork and the overall strategic planning and management of your practice, there is a lot that goes into building a successful business.
Hiring a CPA to handle all of the meticulous accounting and planning work is one of the smartest decisions you can make for your law practice. Having an expert accountant for your law firm ensures that all of your unique bookkeeping and accounting needs as an attorney are met and in safe hands. Let them handle the meticulous details while you focus on what really matters – your clients.
What Is Your Law Firm Looking For in a CPA?
You need a CPA who particularly understands the intricacies of law firm accounting. It’s not about hiring just any accountant. To get the job done right – to understand the ins and outs of running a practice – you need a knowledgeable attorney-focused CPA.
Hiring a skilled Certified Public Accountant (CPA) that specializes in accounting for lawyers ensures you’ll have someone who doesn’t simply help with the traditional accounting and tax services, but one who knows the unique demands and needs of a law practice. Every aspect of running your firm, from financial management to advisory and consultant services, is handled with precision when you hire a specialized legal accountant.
A qualified CPA for laywers should act not only as your chief advisor in all financial matters but as your partner when it comes to sound business decisions needed to grow your practice.
Law Firm Accounting: 6 Steps to Finding the Right CPA for Your Law Firm
1. Consider Why You Need a Law Firm Accountant
No matter the size of your firm, big or small, every practice has its own unique challenges and needs. And the question you should ask yourself is if you can truly handle all aspects of managing your firm while also meeting the needs of your clients and providing them the highest level of service. The answer is most likely: no. Hiring a legal CPA offers you more than just a professional that will file your taxes. CPAs for lawyers are expert advisors there to help you every step of the way in the strategic business planning and financial management of your practice.
2. Evaluate Where You Need Help
When it comes to law firm accounting how to you find the right accountants? To find the right CPA for your law firm, it’s crucial to look at your business and determine what areas you need help with. What services do you need? Don’t wait to see what services a CPA can offer, determine what you need before you even go looking. Are you content with the size of your practice, or are you looking to grow?
In addition to bookkeeping and tax services, do you also need someone to help with your overall business plan and the trajectory of your firm? What about benefits planning and payroll services? These are all things you should consider before looking for a CPA. Knowing what particulars you need help with will ensure you find a law firm accountant that can meet your specific needs.
3. Start the Law firm Accounting Search Process
After you have determined what you need from a specialized attorney CPA, you’ll want to start the process of finding one that is right for your firm. Deciding which accounting firm to go with is just as important as finding the right lawyer to represent you in court.
You might think that all accountants are the same, but each comes with a unique set of skills and areas of expertise that they specialize in, just like a lawyer or a doctor. If you aren’t sure where to start, it is helpful to ask friends and associates that also work in the legal field who they trust or use when it comes to handling their business and finances.
4. Be Prepared: Gather a List of Questions
Once you have come up with a list of potential candidates to handle your law firm’s bookkeeping and planning, it’s additionally helpful to put together a list of law firm accounting questions to ensure your chosen CPA is in fact experienced at handling accounting for attorneys and law firms. To make the most of their services you want an accountant that is a good fit for your practice, who’ll be your partner in all business and financial matters to help you achieve your goals. Some good questions to ask include:
- What experience do you have in the field of law?
- What is the full range of services offered beyond traditional accounting and bookkeeping?
- How would you handle a legal client compared to clients in other industries?
- Do you have experience offering legal business advice? Will you have the knowledge necessary to specifically help us manage and grow our law firm?
- What experience do you have with client funds accounting?
- Do you understand matter costs and how to track them?
- How many firms have you worked with and are you familiar with different areas of practice?
- Where should retainer management live – in my billing or accounting software?
- Is it important to enter client costs into my billing system?
- What data security measures do you take to protect my information?
- Do you need access to our practice management software?
- Have any of your legal clients been disbarred as a result of the work you did for them?
5. Do Your Research: Know Who You’re Working With
Before making your final decision on a legal CPA, it’s important to verify their legitimacy and qualifications. Review any potential law accountants by checking their references and looking up reviews to see how they have engaged with and satisfied past clients. Don’t forget to check their credentials to ensure they can handle the specific needs of your practice.
6. Make Sure You’re On the Same Page
Once you’ve narrowed down your decision and performed a thorough review of one or two potential CPAs, the final step is to establish whether or not they will have a good working relationship with your practice. To do their job well, a CPA will need to work very closely with you and your firm.
You will spend a lot of time together and may even encounter stressful situations. For this reason, it’s vital that you choose a CPA that has good communication and an amicable attitude towards working with you and your firm. If there is dissonance and poor communication from the start, it can greatly affect the success of your business.
Try again if necessary. While hiring a CPA will benefit your firm, finding the right one that can handle law accounting and all other aspects of your business is not always easy. You may feel tempted to just stick with the one you chose, but it’s important to remember that you can go with someone else if it doesn’t feel right. Handling accounting for law firms and attorneys is no simple task. Even if it takes a little extra time, putting in the effort to find a CPA that is right for you will ensure the success and growth of your law practice.
Shannon & Associates Can Help! We Provide Law Firm Accounting
Finding a CPA that specializes in law is essential to growing your practice and achieving your financial goals. Though finding the right one is no easy feat, you’ll be happy you put in the time and effort when you see the results that come from hiring a knowledgeable attorney CPA.
At Shannon & Associates, we help law firms excel by allowing them to focus on their clients and the integrity of their practice by taking on the heavy lifting ourselves. Through trust, honesty, and a personalized holistic approach, we handle all aspects of the financial planning and business strategies that go into building a successful law practice. Think we could be the CPAs to take your law firm to the next level? When you’re ready, we’re here to answer all of your questions to prove how our team of experienced legal accountants can help your practice thrive.
Contact us today to get started with one of our partners. Let us help you manage the day-to-day processes of your firm so you can get back to focusing on your clients.