Do You Know The Financial Health of Your Solo/Small Firm Practice?

kahuna-125x125v3Are you paying attention to your solo/small firm finances?  No, seriously.  Be honest.  You don’t have to tell me but you do have to be honest with yourself.

Or are you punting, procrastinating, putting it off for another day, avoiding it like the plague, saying you’re going to hire a bookkeeper or your current bookkeeper is your sister-in-law who is doing a half-baked job but she’s a relative and she’s cheap and really needs the work?  But switching bookkeepers means training someone new and then still having to issue that W-2 or W-9 and if you hire him/her part-time to work in the office then you have worker’s compensation, unemployment insurance, vacation-time, sick time.  Wow.

I know too many lawyers who mumble under their breath when it comes to the finances of their law practice. For a good while, when I had my own practice, long before the days of affordable cloud services, I was punting in my own practice.  After all, it is a burden to stay on top of and it is not the “sexy” part of being a solo attorney.  There is nothing to be glorified about those days each month when you (must) take the financial temperature of your practice….the days you really skip and cross your fingers that everything is OK.  But you know what, it is the MOST important part of being in business for yourself and to neglect it is to play Russian roulette with your future.

If you don’t know where you stand at the very least on a monthly basis, you could be falling off a cliff and won’t know it until you hit the ground…on your head.

Don’t do this to yourself or your practice.  Don’t be one of those great lawyers who go out of business because you don’t know how to keep track of the financial health of your practice.   It is not a good place to be and it will stunt your professional growth. It may even force you to ‘get a job’ for something which is fairly easy to remedy.

It is vital that you use  financial statements to tell you about the health of your solo practice.  It’s critical that you reconcile all of your accounts each and every month. That you get an Income Statement, Statement of Cash Flows, and Balance Sheet each and every month. It’s got to be done. (I know, you’re starting to break out in a sweat).

For smart lawyers who don’t have a gifted bookkeeper or can’t afford a gifted bookkeeper who can come to the office,  the only way to do this consistently is to outsource it.  Many lawyers will try to do it themselves until they finally realize they can’t.  And here is the big surprise.  An outside vendor is just not that expensive, even for a new solo.

So, we searched high and low to find a company that will work accounting miracles for an extremely reasonable cost.  We’re proud to welcome our newest sponsor, Kahuna Accounting, the virtual bookkeeping and accounting firm which uses Xero.  I am now starting to use Xero myself to manage my business. But for you, Kahuna Accounting does  accounting and bookkeeping and provides each client a monthly financial statement so they can see the health of their business.  They also prepare the books so that it is incredibly  easy at the end of the year to just hand a finished packet to your CPA.  They’ll have everything they need, no follow ups.  This saves a ton of money.   But it also saves a ton of time, time you can now use to bill clients, go to a professional conference, or just leave the office early and spend time with family.  The best part, though, if your tax preparer has questions, they can just turn to their dedicated Kahuna accountant (that’s right, you get a dedicated accountant) to answer the questions and it is all part of the monthly fee.  No additional charges.

This ultimately is priceless, and very smart.

Don’t operate the finances of your business by ‘crossing your fingers’ and hoping everything turns out OK.  You wouldn’t represent your clients this way.  Don’t run your business this way. Check out Kahuna Accounting. You’ll be glad you did.

As always, we pass through any benefit SPU may receive directly to our students and they will receive special discounts or other offers on our sponsor’s product/services. Kahuna Accounting offers our students a substantial discount on the initial setup costs.

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