Small law firms have lots of tasks to deal with on a daily basis. Bookkeeping is one of the essential things and a part of any type of business. Some law firms might underestimate the importance of the process. In most cases, one employee will take care of the accountant tasks for the law firm. Or some owners might undertake this crucial task on their behalf. However, there are a few problems related to this topic that law firms can encounter. Read on and find out more about the six common pains for the law firms.
1. Finding the right employee
The process of recruitment can take lots of time. Going through CVs, doing interviews, and comparing different candidates is a time-consuming process. You need to find the person that has the right skill set, relevant experience, and fits your particular budget. For example, workers comp attorneys in Richmond might need an employee with a special skill set in that area. If you need help covering the expense of hiring, see if title loans are a good idea for you. Also, the law firms don’t have extensive knowledge and might find it challenging to navigate through the skill set required. One of the most important tasks is applying for LLC Formations Tax ID which requires lawyers to be up to date with government requirements to ensure a positive outcome.
2. Losing time on training
Many business owners think that hiring an experienced employee would exclude the need for training. However, this doesn’t seem right. No matter the past experiences of the employee, you need to put time and effort into training your new employee. It would be best if you got them introduced to your specific practices and work process. If you don’t do this, the bookkeeper might continue working according to their system. Keep in mind that even minor mistakes can cost a lot.
3. Costs for a bookkeeper
Another challenge that law first experiences the high cost of a good bookkeeper. The truth is the professional workers come at a high price. Small firms for startups find it very difficult to cover the expenses in the beginning. This makes them limited to only one bookkeeper at a time. Or, others tend to get a part-time employee to solve all of their recordkeeping tasks.
Hiring a full-time employee is more expensive than outsourcing the service. A simple feasibility analysis will tell you if it is better to outsource the bookkeeping service. For small companies, it is more feasible to hire services from a reputable company. Bookstime is specialized in offering services for small businesses, which lets them focus on growth.
4. The workload
This point is connected with the high costs of having a bookkeeper. Small firms don’t have the finance to invest in a whole department. We already mentioned that law firms try to reduce their costs and limit the specific role to one person only. Of course, this puts a tremendous amount of stress on the employee. The vast workload will result in reduced productivity, missed deadlines, and fatigue. If certain aspects of the firm can be outsourced, the better. For example, instead of doing marketing in-house, find a law firm marketing agency specialized in what they do.
The huge workload and a vast number of transactions can result in mistakes. Having only one employee means that there is no one else to cross-check and correct their work. They need to be able to recognize and fix their own mistakes.
5. One-man show issue
Owners of small law firms will try to do every task on their own. Many will hurry up to get educated in the field of accounting to manage this aspect of their business. However, this can be a huge downside. You might lose your time focusing on accounting and ignoring other important aspects of the company, such as customer retention and improving the service. Also, bookkeeping might be an unfamiliar topic and will take lots of precious time from your schedule.
One of the major pain points is trust. A bookkeeper is someone that will have access to delicate financial data. They have access to your bank account and all the transactions that happen. You need to feel comfortable with the person having access to this type of information. Outsourcing the service to a reputable company is a safe pick.
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