Living the Eye Life!
After three long years we finally get to meet Tim Kidd the Chief Executive of the ILFM. When I say meet, I mean in person! We have spoken many times throughout the pandemic, but we actually got to sit down together and chat about where the time has gone. I have to say the entire team at the ILFM have been amazing throughout a very challenging time providing a huge range of support to its members including the ILFM Spring Conference and the virtual branch meetings. But in my opinion, you can’t beat the real thing and it was great to chat about what has been going on in the legal sector. AML compliance and returning residual balances continue to dominate the headlines and rightly so. Never has there been a time when firms need to get on top of these issues before they come back to bite you.
As usual, Financial Eye have been out and about travelling the length of the country talking to Managing Partners, Finance Directors, and Legal Cashiers to help them address their concerns and develop plans to allow them to move forward. I have previously mention that getting around the country feels just like it always was – busy. Packed trains, heavy traffic and fully booked hotels are the new normal. But there is something else that has taken us quite by surprise and that is a seemingly a shortage of support staff available to work in the accounts department. Where have they all gone? Last year we noticed that firms were struggling to recruit conveyancers following the stamp duty holiday. The knock-on effect appears now to have caught up with finance teams.
When our clients said they needed conveyancing support we reached out to third party providers and eventually found a rich seam of conveyancers located in, of all places, South Africa! There were a number of companies located in Durban that could complete title reports to an incredibly high standard with amazing turnaround times. They have subsequently moved into post-completion work and residual balances much to the delight of the UK law firms using them.
But the same Durban companies have now set their sights on providing accounting support to UK based law firms. So firms that been struggling to hire staff to support their legal cashiers are now looking beyond the traditional market for these services. It all felt a bit strange to begin with but if there is one thing the pandemic has taught us is that staff can access case management and accounting systems from home. And if they can do it from home, they can do it from anywhere. There will always be a need to have qualified and trained accounting staff based in the office. But support staff? They can now be located anywhere in the world. In fact, they can even be ILFM qualified as all their training is now available on-line. The opportunities are endless, and I find it quite mind blowing.
Clearing up residual balances on the other hand is something that does not really lend itself to outsourcing. We have learnt that the only way to get these resolved is to be on site and talking to fee earners face to face. You can send them as many reports as you want but if you want to make quick and meaningful progress you have to get into the office and talk to them. Other wise you go round and round in circles. Its possible that fee earners take more notice of us simply because we are independent and not familiar faces that they see every day. And we have been sent in with the backing of the Managing Partner which seems to add some weight and gets everybody’s attention. The thing about residuals is that they cannot be mopped us once in a while. The whole process needs to be redesigned so that they don’t arise in the first place. You can have as many written policies in place as you like but unless somebody has the job of enforcing these policies, they will creep back in again. A bit like Japanese knotweed!
Next week we will be in Birmingham going through the same exercise again visiting a firm that has recently been acquired by an existing client. Those of you that have been involved in a recent merger will recognise this as an issue that has to be addressed immediately, not least because the SRA will not allow you to transfer them over to the acquiring firm. So we will have to blitz them as usual and make sure that the process is conducted in a way that will satisfy the reporting accountants and the regulator.
We finished our conversation with Tim talking about what other things might happen during the second half of the year. Well one thing we learned is the next ILFM conference scheduled for November will be a “real” conference. Sure the virtual conferences have been absolute lifesavers but as I said earlier, in my opinion they don’t beat the real thing! How lovely will it be to get on a train and head to the venue and shake hands with people I haven’t see for over two years! We might even have an opportunity to drink a couple of glasses of wine with some of you. Now that is a lovely thought. Back to living the eye life!
Director – Financial Eye