Profitability Accounting as a Financial Management Tool

Law Firm Profitability Accounting

A Systematic Approach for Measuring the Profitability of the Firm.

  • Identify Revenue
  • Identify Direct Costs
  • Identify Indirect/Overhead Costs
  • Apply Direct and Indirect Cost to Revenue

Have you considered how using Profitability Accounting might help your Firm?

Profitability Accounting is an allocation process, which measures the gross and net contribution to the Firm's profits of a given revenue stream.

An Accounting analysis, which calculates a series of direct and indirect rates per timekeeper per hour allocated to a defined revenue stream to measure gross and net contribution to Firm profits.

Who should use Profitability Accounting?

  • Law Firm Management
  • Executive Committee
  • Practice Group Leaders
  • Billing Attorneys

What is Profitability Accounting? With this information, the Firm can improve its profits due to a better understanding of their:

  • Revenue Streams
  • Cost Structures
  • Pricing Points
  • Relevant Volumes
  • Profitability Logistics

Improve Firm profits due to a better understanding of their:

  • Products
  • Clients
  • Attorneys

When should Profitability Accounting be used?

Measurement of Profitability of Revenue:

  • Products
  • Clients
  • Attorneys

Where should Profitability Accounting be used? As Frequently as any Financial Management Tool�


Why use Profitability Accounting?

  • All Clients Contribute to Profitability
  • All Attorneys Contribute to Profitability
  • Create Better Informed Decision Makers
  • Cost Structure & Guidelines
  • Rate Structure & Guidelines
  • Profitability Models

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LMS Testimonial

"Everything was included, and the functionality could be implemented as we needed it.   We especially liked the Imaging, Workflow, and Profitability Accounting modules, as well as the ease of reporting with the Dashboard."


Holly Coyle, Accounting Manager Murphy Desmond S.C


Profitability Accounting

"Every business needs to know this... Use LMS as your Financial Management System for a strategic Market Advantage."

Jay Erdman, principal of Rippe & Kingston