Internal financial controls
One would think that lawyers could keep their eye on the ball. But, somehow, despite the importance of cash and cash flow to the very survival of the law firm, lawyers tend to focus their attention elsewhere. I find this to be true not only in the small firm, but also in some of our larger brethren as well.
Recently, I was asked to consult about "missing cash." The bottom line is that it’s easy, for even a longtime and trusted staff person, to lose his or her moral compass … when money is readily available … and not regularly monitored! Establish policies for handling cash and for paying bills, the two easiest areas of manipulation by one so inclined. Be persistent in the application of these policies. Ask for an external review of these policies periodically … and their application. Insist that there be no shortcuts in handling the finances of the firm.
Nothing less than the firm’s reputation and standing is at stake! … And the lawyer’s license to practice law.Tags: Cash Flow - Finances, Management