An attorney's services become revenue through the following process:
- Billable: When hours or fixed fees are recorded after the work is done
- Billed: When a bill/invoice is created with the billable, and sent to the client
- Collected: When a client pays the bills
The revenue reports in LeanLaw are concerned with billed and collected amounts. The reports are either organized by client/matter or by attorney (or other users). They are discussed below, but first:
An Important Note about Dates
When creating a report, it is typically filtered by date such as "Year to Date" or "Last Month". The filter will determine which invoices are used as a basis of the report.
For example if an invoice is dated November 30 (billed) and paid December 2018 (collected). A report showing just December will only show the amount collected, not the amount billed.
Also, trust and account balances always show the balance for today's day. For example, if you on March 1, 2019 run a report for Year 2018, the billed/collected numbers will be for 2018, but the balances will be for March 1, 2019.
Revenue by Client
In LeanLaw, go to Reports > Revenue by Client.
This will show billed and collected summarized by client and matter. Remember to pick the time period that you are interested in, with the period filter on the left.
The report will also show trust balances and receivables (account balance) for each client. As stated before, note that the balances are always based on today's date, not the end of the time period selected.
Revenue by Attorney
In LeanLaw, go to Reports > Revenue by Attorney.
This report is powerful but can also be complex to understand. At a high level, it is simple: It shows billed and collected for each attorney (user) in the your account. Specifically how revenue is attributed to each user is a bit complex and also depend on a few options that can be set.
By default, the numbers simply reflect what a given user has contributed to invoices. For example, take the following invoice:
Attorneys AA and BB have contributed to this invoices, AA with hourly services, a fixed fee and also some expenses. BB has some hours assigned. There are also some items not assigned to individuals including a fixed fee and expenses.
The revenue allocated to AA is total of services and fixed fees and doesn't include expenses, so $400 + $200 + $500 = $1,100. The revenue allocated to BB is $150.
Discounted or Partially Collected Invoices
Now, if the invoice is discounted, or only partially paid (or both), the revenue will be allocated proportionally to the attorneys, after unassigned fixed fees and expenses. So for example if only $1,800 was collected for this invoice, we will allocate $1,800 - $110 (expenses) - $1,000 (unallocated fixed fees) = $690. This will be allocated proportionally been AA and BB, so $690 x $1,100/$1,250 = $607.20 for AA and $690 x $150/$1,250 = $82.80 for BB.
You can optionally set all unallocated fixed fees to be allocated automatically to the responsible attorney for the matter. In the above example, this would allocate the $1,000 to whomever was the responsible attorney. (This is done in Settings > Reports.)
Allocations for Originating Attorney and for the Firm
LeanLaw allows you to set a percentage of collected revenue for the originating attorney and/or for the firm (see Settings > Reports). This will add additional columns and adjust the collected revenue for each attorney.
For example, if 20% is allocated for the origination attorney and 20% is allocated for the firm, the "share" column will show how much of the collected revenue is for the attorney (60% in this example) and the origination column will show the 20% revenue for the attorney that originated a matter. Finally, the "adjusted" column will show sum of the share and origination columns.
The originating attorney is set for each matter under Matters > General. If multiple originators are set for a matter, the origination share will be split evenly between the originators (if the share is 20% and there are two originators, they will be allocated 10% each).