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On Balance

An Honest Audit Leads to a Brighter Future

By Megan Zavieh

There are myriad reasons to run an efficient, sound, organized law practice. Here are two great ones, from an ethics standpoint: First, it helps lawyers avoid making the costly errors that lead to ethics trouble. Second, when lawyers receive a bar complaint — as many eventually will, no matter how well they practice law — responding effectively is significantly simpler.

We’ve discussed those reasons in this column before (“A Pre-Year-End Checklist for Solos and Small Firms” and “Overcoming Fear of Success Through Ethical Safeguards”). But, with all the talk about why we should improve our practices, the fact is that tweaking the edges of processes and procedures will not bring about the level of improvement most of us need.

To really take on the challenge of running a smooth business that complies with the ethics rules and provides the framework for easily responding to regulators when questioned, we need to take a hard, honest, comprehensive look at our firms.

What Are You Looking at in Your Practice?

When taking a serious look at the way you practice, here are some things you need to analyze and questions to ask:

  • Technology. Are you using the types of technology a well-oiled machine is expected to use? Practice management tools (like Clio, Rocket Matter, MyCase) are essential. Other necessities include billing electronically, accepting online payments, using cloud backup for all systems, as well as secure email and VPNs.
  • Client intake. Are you bringing new clients onboard in a consistent manner, and obtaining necessary information from all of them? Running conflicts appropriately? Obtaining fee deposits before doing substantive work? Sending non-engagement letters when prospective clients do not turn into actual clients?
  • File management. Is everyone in the office opening and naming files in a consistent manner? Maintaining all documents electronically and securely? Shredding paper documents or otherwise storing them securely?  Closing files consistently?
  • Trust accounting. Are you maintaining all records required by your state’s rules? Do you reconcile at least monthly? Do you know on any given day exactly how much money is in the account — and to whom every dollar belongs?
  • CLE. If you are in a state with an ongoing continuing education requirement, are your records complete and current?

How to Get an Honest Audit

It is easy to take a quick look over your office and have one of two reactions — either something like, “It’s all good enough, I’m fine” or, “Oh no, this is horrible, overwhelming and unfixable.”

Either of these reactions will likely result in no action — and thus no improvement.

To get a real look at how well your practice is functioning and where it needs improvement, and as an added bonus how to improve it, you want an outside perspective.

The good news is there is a whole industry blossoming around this need. Outside consultants will dig into your practice in a full-scale audit, analyzing how you work versus how you should be working, and offering solutions for how to improve. (Jared Correia discusses this work on a recent episode of my podcast, Lawyers Gone Ethical.) This is an incredibly important step for anyone serious about improving their practice. A full-scale look under the hood will reveal truths you may not want to face, but which you can use to dramatically improve how you operate.

There are also consultants who are bringing project management tools to bear on small law firm operations. (We spoke about this work, with John Grant, on the podcast too.) This is a great option if you are open to revamping how you work and finding new efficiencies. Implementing these tools could help free up significant time and increase your capacity for more profitable work.

If you would rather take a more private look at your firm, Lawyerist has a new free tool called the Small Firm Scorecard to help you self-assess. If after completing it, you decide you want assistance making improvements, Lawyerist offers a one-year course to help you implement changes.

Tackling the Project When It Feels Insurmountable

Taking a long hard look at your law firm operations may not be easy. It’s hard to be honest, and it’s hard to take criticism and face reality. But your operations are not going to improve if you bury your head in the sand. The business of law practice continues to evolve, and if you have not directly addressed the areas in which you need to improve, you are more likely to make mistakes that lead to ethics trouble. Even if you operate entirely ethically, proving it when someone complains to the bar will be significantly more burdensome if your firm is not operating efficiently.

So take part of the slower summer months and do an audit, call a consultant or self-assess, and set your firm on the road to improvement.

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Megan Zavieh Megan Zavieh

Megan Zavieh is the creator and author of “The Playbook: The California Bar Discipline System Practice Guide.” At Zavieh Law, she focuses her practice exclusively on attorney ethics, providing representation to attorneys facing disciplinary action and guidance on questions of legal ethics. Megan is admitted to practice in California, Georgia, New York and New Jersey, as well as in multiple federal courts and the U.S. Supreme Court. Her latest book, “The Modern Lawyer: Ethics and Technology in an Evolving World,” (ABA 2021 ) covers how to run a modern practice while staying in line with current ethics rules. She podcasts on Lawyers Gone Ethical, blogs on ethics at California State Bar Defense and tweets @ZaviehLaw.

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