According to R3, the insolvency trade body, over 2000 law firms are at risk of insolvency in the next 12 months. They have come to this conclusion by analysing the "fame" database which holds financial and credit rating information on UK businesses. At the end of July, Limited Liability Partnership (LLPs), Partnerships and Sole Practitioners who are not directly assessed for tax on the business’ profits have their second on account payment due. Legal firms have various challenges ahead most importantly from the new Legal Services Act that allows non solicitors to own legal practices. This was dubbed the "Tesco Law" as predictions of lawyers offices in supermarkets emerged. The LSA will no doubt lead to increased competition especially for small high street firms.Traditionally law firms have not been particularly good at collecting cash in as much of the work is in progress and a focus on billable hours sometimes means that debtors do build up.So if your practice is, or you are
- experiencing cashflow problems?
- You are concerned about paying your professional indemnity premiums?
- worried that insolvency may affect your ability to practice in the future?
- You don’t want to risk the SRA Intervention
If so then you should read our new pages on help for lawyers with cashflow problems