Building Bonds - Practical steps for administrators to foster the banking relationship

Published in Association of Legal Administrators, September 2013

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Once billable work is turned into collected cash, law firm administrators must manage the cash flow process so the firm remains solvent as a business. Today’s financial information systems can and do produce extensive and detailed cash flow data, but they cannot adequately handle the cash management process in themselves. However, administrators who properly prepare can turn to an experienced ally — the firm’s banker.

Law firms are attractive customers for banks. Administrators should not hesitate to establish banking relationships because of stereotypical myths, such as “bankers only want to lend you money when you don’t need it,” or “bankers are under such tight controls by regulators that they won’t or can’t meet an unexpected lending need.” The reality is that banks and law firms are both professional service businesses and can develop mutually beneficial and effective business relationships if they prepare appropriately. The administrator’s preparation requires selecting the right bank, building solid relationships and structuring the optimum service package.

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