The Ides of March Receivables Are Upon Us

Spring is around the corner and now is a good time to address those older accounts that have been hanging around since last year going nowhere.  

There are many reasons why ageing receivables continue to occur that firms need to address. Behind most receivables over 90 days past due is a story about why the account has not paid – including cash flow problems, complicated relationships that have stagnated and many more.  Make the time early in the year to help take some of the pressure off collections efforts for the rest of the year. It is never too early to help ensure your firm’s financial success!

Here are a few tips for addressing your receivables early in the year, so that you see better results sooner rather than later:

Urge firm leadership to be decisive and step in to take action – Management must work through receivable issues and not just accept attorney statements like: “I’m working on it” or “I’m in contact with my client about this.” It’s time to change these old habits. You need to make it clear about the goal of the firm to collect its receivables timely, as well as the firm’s expectations of its attorneys. Although there needs to be a fair amount of latitude with certain client relationships, firms must be careful not to give an inch and see it turned into a mile.

Give the leadership in your firm something to work with – Whether it is a senior lawyer who oversees all A/R efforts or a committee, provide them with useful information about collections efforts, including who is responsible for specific collections and what progress is being made. Information about A/R must look behind and underneath the numbers to find out the true story of payment probability.

Project realistic timeframes for collecting receivables – If it appears that a given receivable will not be collected by the deadline, let management know. Most importantly, let the attorney know that you are letting management know. Throughout the year, firms should be tracking payments, so they know as early as possible if payments are not going to be made, and they can determine why and what can be done.

We all know the old saying: money never sleeps. Now is the time of the year for a wake-up call. Learn more on our web-site at http://www.clientci.com/