“You have to understand accounting and you have to understand the nuances of accounting. It’s the language of business and it’s an imperfect language, but unless you are willing to put in the effort to learn accounting – how to read and interpret financial statements – you really shouldn’t select stocks yourself.” Warren Buffett
Law is an intricate profession. There’s nothing simple about it, including its finances. That’s why there is a market specifically for legal accounting software. The market is relatively big, which means you have to carefully consider your needs before you purchase any cloud-based accounting software for law firms.
10 Key Factors To Consider When Choosing Accounting Software:
The term “law” encompasses rather a lot. The different types of law have different accounting needs, a great deal of which is regulated by state and national governments. The trouble is, the regulations can vary across state lines, so it’s very important that you think about where you’re going to practice before you commit to a package that might not be customizable.
We’re going to look at 10 more factors that affect your software decision-making.
Size Of Your Law Firm
Some software packages are made with a size in mind. So you can find accounting and law practice management software for small, medium, and large law firms. This means you’re limited to a certain number of users or accounts.
You don’t know what the future holds, so it’s a good idea to look for software that is scalable and that will grow with your business.
It’s advisable to talk to your accountant before you buy any software. It’s helpful if your software is at least compatible with your accountant’s. That way your reports and other records are in the same format and it’s easier to discuss matters over the phone when you’re looking at the same information.
Required Accounting Features
Some features are pretty standard, like payroll, accounts receivable, and accounts payable, but other features depend on the exact nature of your business. For example, you might need stock management functions but not those that cater to multiple locations.
Again, you don’t know what the future holds, so it’s a good idea to choose a product that isn’t too limiting. Customization is always a good option, so look for software that you can adapt to your firm.
Ease Of Use And Learning Curve
Perhaps the single most important factor is the ease of use. If the software is not easy to use, you won’t want to use it. It’ll make all of your tasks difficult and unpleasant. You’ll dread having to update client accounts or work with payroll. If you don’t dread it, your bookkeeper will.
Look for a product that is largely intuitive and that doesn’t require a two-week training course to master. If training is needed, find out if the vendor provides it or if you have to find someone else. It’s frustrating to choose software and then have to find an instructor to teach you how to use the product and pay for the training to boot.
It’s far simpler to buy a product that you enjoy using and that doesn’t need you to pass an exam to operate.
Is The Accounting Software Cloud Or Desktop Based
This factor is becoming increasingly important as the ability to work remotely is something that many people in the workforce find desirable. A cloud-based package is necessary if you’re going to embrace the work-from-anywhere movement.
Desktop software is suitable if you operate from an office and if all employees who need to work on the system have the same software installed on their work devices.
Each option has its pros and cons, so you need to think carefully about what you need from your accounting software.
Cost And Budget Considerations
Your budget is obviously a hugely important factor that will influence your decision. You need to think about:
- Is it one package with set features and no options to customize functions?
- Will you need to purchase upgrades?
- What is the cost per user?
- Does it meet all your needs or do you need to purchase more than one product?
- What are the setup costs?
- Will it integrate with your existing systems or will you need to buy even more software to accommodate it?
Scalability and Future Growth Potential
Scalability is easy to underestimate, but you have to think long-term when you buy accounting software.
Will the software mold itself to your firm? Does it allow for multiple locations if you want to open another firm? Can you add users if you employ more staff? How many accounts can you add? If your practice takes off, you might need to add a lot more clients to the system than you currently anticipate.
What happens if you include another branch of law in your firm, can the software extend to accommodate new functions? If not, are there compatible upgrades that easily integrate with your existing system?
Customer support is a bit of a running joke. How long do you stay on hold, how valuable your call is to them, and what panpipe CD do they have on repeat?
It’s actually pretty serious. If you have a problem that needs fixing, you need it fixed now, not in 24 hours. So when you’re looking into different vendors, make a point of looking at reviews for customer support.
A 24/7 helpline is ideal, experienced staff is non-negotiable, and so is patience. You need customer support with patient people at the end of the line because not everyone is comfortable messing around with software that contains an enormous amount of highly sensitive data.
Thankfully, there are several software review sites you can visit to see how good vendors’ customer support is.
Stability Of Service Provider
We’ve mentioned highly sensitive data. It’s worth mentioning again because law is basically entirely composed of sensitive data. You have to have a service provider whose service is reliable and stable.
Review sites will really stand you in good stead as far as this is concerned.
Reporting And Analytics Capabilities
Reports are a big part of accounting. The software needs to be able to generate a variety of reports that are all 100% accurate. The reports also need to align with current reporting structures, so there is no lag time trying to decipher different formats and styles. This makes accounting software integration an incredibly important factor to consider when making a purchase.
You also need to consider if the reports are compliant with industry regulations. This is something the software vendor should be able to tell you upfront.
Security And Data Protection
It comes back to sensitive data. Sensitive and confidential data. You need to be able to rely on the vendor’s inherent security measures, as well as your security measures if you’re working with desktop software. Your security measures need to align and not counteract one another.
Cloud-based providers are solely responsible for your data’s security, so check out this site that contains information regarding the vulnerability of various vendors on the market.
Whether you go with desktop or cloud-based accounting software, always find out about data security guarantees or warranties. You must have some course of redress if things go wrong.
Conclusion and final recommendations:
Law firm accounting software plays an essential role in the success of your practice. Get it wrong and you and your clients could be in a world of trouble.
Not only is your reputation on the line, but your whole career is also at risk if your financial records fail to comply with legal requirements.
In a situation like this, you need to put your research skills as a lawyer to work and do your due diligence to find the right financial software solution for you.
Note: You can find out more about the software available here.
Sage Intacct is a world leader in ERP software and AI-powered solutions. Their accounting software for lawyers and their practices is designed to be scalable so it will grow with you and your company. Functionality includes the ability to automate certain processes that don’t need your input, so you can get on with managing cases and wooing prospective clients.
Enjoy seamless integration with your existing systems so you’re ready to go ASAP.
Choosing accounting software for your Law Firm can be overwhelming due to the multitude of options. Let LWI assist you in selecting the right solution for your needs, or follow our expert guidelines to make an informed decision.