Rocket Matter’s legal billing software streamlines the entire invoicing process, from generation to collection. Automatic invoice creation and predetermined schedules ensure timely delivery, eliminating late fees and potential client disputes. A streamlined AR process can significantly transform the operations of a law firm. By implementing effective strategies, firms can enhance their collection rates, reduce the time spent on administrative tasks, and improve their overall financial health. This allows the firm to maintain a steady cash flow and the entire team to focus more on delivering high-quality legal services to clients.

Best Practices for Accounts Receivable Collections

With LawPay, you can accept bank transfers via ACH plus credit card payments online or in person. You can also set up automatic, recurring payments for clients who prefer a set monthly fee. Consistency is key to establishing a routine and helping clients pay invoices on time. One of the tried and true best practices for collecting accounts receivables is consistent invoicing.

How to Track Your Firm’s Financial Performance in Firm Central

Implementing these strategies can transform your legal firm’s accounts receivable process from a headache to a well-oiled system. Next, let’s see how you can supercharge your accounts receivable management with exciting digital solutions. So, the client has finally entrusted you with their case, and you’ve clarified the payment structure. Establishing open communication with your client is important to ensure your law firm’s accounts receivable management is smooth. Start your free 10-day trial of MyCase today (there’s no credit card needed).

Provide Several Ways to Pay

And with only inflexible, manual processes to keep track of it all, it’s not surprising when some bills fall through the cracks. Generally speaking, once firms send out an invoice, they’ll usually wait until their payment due date expires before contacting a client. Payment due dates vary from firm to firm—while some have 30-day payment due dates, others might be more lenient and extend this to 60 days.

• Electronic invoices can be calculated automatically, go out as soon as they’re ready, and can be paid instantly.
• When a significant portion of revenue is tied up in unpaid invoices, it can hinder the firm’s ability to cover essential expenses like payroll, rent, and other overhead costs.
• Afterward, utilize financial software for an overview of all accounts receivable debt owed to your firm.
• With a few clicks of the mouse, the firm can simultaneously secure payment for all client accounts with stored payment methods.
• In extreme cases, when you cannot come to a solution with clients, you may need to engage with a collection agency that can assist with recovering payment.
• It may sound obvious, but the first step to reducing this friction is to make it easier for clients to pay their bills.

Final thoughts on improving the accounts receivable process for law firms

By implementing the strategies outlined above and leveraging Rocket Matter’s suite of tools and features, you can streamline your AR process, improve cash flow, and drive your firm’s growth. Providing clients with various payment methods can significantly improve your collection rates. Many clients prefer the convenience of online payments, which not only speed up the transaction process but also accommodate your clients’ diverse preferences.

• Friendly payment reminder email templates are available to take the stress out of collecting money.
• Clients can also settle payments easily through third-party payment gateways like Stripe, PayPal, Flutterwave, or Wave.
• The first step to solving this challenge is finding a solid time-tracking solution..
• These communications may include the initial engagement agreement and a separate payment explanation agreement.
• Implementing a solution that automates accounts receivable processes minimizes the possibility of human error, such as inaccurate invoices, duplicate entries, and overpayment.

When you’re busy serving clients, the last thing you want to do is stop to handle online billing and other administrative work. Plus, with our Smart Time Finder, your firm can capture billable time you may have missed via a passive time-tracking feature. MyCase passively tracks activities done in the platform to ensure https://www.bookstime.com/ you’ve tracked time for all billable work. Consistent communication can help you get on the same page with clients and minimize the chance of disputes or billing issues down the line. Using succinct descriptions in the invoice can also help clients easily understand what you’re charging them for.

From there, you might escalate the frequency of telephoned requests for payment. If you are calling once monthly on accounts under 30 days late, bump it up to once weekly for accounts over 30 days late. You could also send a written notice that you’ll turn the account over to collections when it reaches 90 days past due. The best time to pitch clients on scheduling payments is during intake. You can have them law firm accounts receivable management sign payment authorization forms and set up the payment plan from the get-go.

Assess the effectiveness of your AR process regularly and implement changes as needed. Stay updated on industry best practices balance sheet and technological advancements. By implementing these strategies, you can transform your accounts receivable.

How to Manage Your Accounts Receivable

It’s important to stay on top of accounts receivable since it represents revenue for your law firm. Do away with manually monitoring payments and sending clients reminders. With the Automated Bill Reminder feature, your attorneys can spend more time on billable work instead of chasing up payment. Use automation to make sending bill reminders an effective, efficient process rather than a never-ending distraction.