A law firm can finish the year with healthy revenue and a solid profit while still experiencing months when cash feels surprisingly tight. That may sound contradictory, but profit and cash answer two different financial questions. Profit tells you whether the firm is earning more than it is spending over a period of time. Cash […]

A $400 hourly rate looks straightforward. If an attorney records 10 hours, the firm should generate $4,000 of revenue. In practice, the math is often different. Some time may be written down during billing review, a client may receive a discount, or part of the invoice may remain unpaid. By the time the work turns […]

Suppose your law firm expects to finish 2026 with $1.8 million in revenue and wants to reach $2 million in 2027. The additional $200,000 may sound reasonable, especially if the firm has been growing, but putting that number into a budget does not explain how the business will actually produce it. That is where realistic […]

As law firms begin thinking about 2027, it can be tempting to start with a growth target. Take this year’s revenue, add 5% or 10%, adjust a few expenses, and use that as the foundation for next year’s budget. The approach is simple, but it can overlook some of the most useful information your firm […]

When law firms think about lost revenue, unpaid invoices usually get most of the attention. A client has been billed, the balance is sitting in accounts receivable, and everyone can see that the money has not been collected. But there is another kind of revenue loss that can be much harder to see: work the […]

Running a law firm means making financial decisions all the time, whether you think of them that way or not. Can we afford another attorney? Is it a good time to increase compensation? Are we collecting quickly enough? Can we invest in new technology? Is the firm actually more profitable than it was last year? […]