Cash-flow management

Debtors' control can be seen as the Achilles heel of a firm, without it a firm might have no money to pay staff salaries. Best practice for debtors' control entails the following:

• Responsibility - of the lawyer who opens the file, to close it and to collect the payment from the client.
  
• How to bill the client - be sure what method clients prefer.
  
• Get your age analysis - a weekly updated age analysis is the primary tool for managing debtors.
  
• Ageing of debtors - unpaid accounts of more than 90 days = bad debtors control.
  
• Trust credits and the transfer to your business account - it is a management sin not to transfer your fee portion to the business account on a daily basis.
  
• Bills from sheriffs, advocates or experts - collect the expenses and pay them.
  
• Taking deposits and topping up when required - take a deposit from a client who you do not know.
  
• Use the correct language - when asking for a deposit put it in writing and be clear.
  
• Billing regularly practice - send smaller monthly bills and ensure clients pay them.
  
• Communication - billing can be a good form of communication.