Drawbacks of Reconstructive Timekeeping

One of the most difficult aspects of legal billing, is timing and accuracy. Timekeeping can become a cumbersome task for a busy attorney, which may lead to the improper documentation of time spent on a specified case thus, causing many to delay their billing process for months on end. Inefficient methods in timekeeping, and the very typical use of the reconstructive time approach, heavily impact the accuracy of hours spent on a case. Though the advent of software tools for legal billing has brought changes in the legal arena, many have not standardized the billing process and are still struggling with antiquated procedures for time entries. The following four reasons explain why accurate time entries are a necessary practice for any size law firm.

 

Loss in billable hours

Recollecting previous billable hours can become a difficult process as time passes by. Guessing and estimating the number of hours spent after a task has been completed can result in the loss of several billable hours.  It is unlikely that one can recall the exact minutes they have spent on email responses, phone conversations, and reviewing paralegal work. Minutes, and even hours, may slip by while making adjustments between several clients. These small bits of time each day may add up to several billable hours at the end of each month.

 

Leads to inaccuracies

Reconstructing past time spent on an activity, case, or task to increase the billable hours will lead to inaccuracies in billing. For attorneys who charge clients on an hourly basis, the billing process can be frustrating and time consuming. When there is not a proper system established to capture time contemporaneously, the miscalculation of hours spent on a task easily occurs. Calendars, emails, and phone logs become important information for reconstructing time, however, this may lead to billing inaccuracies due to cancelled appointments, email chains with varying time spent, and phone logs with little information. This ultimately results in the undercharging of a client with less legitimate hours or the inflation of an invoice using miscalculated time. In any case, reconstructing time entries is not conducive to billing practices.

 

Reduced Law firm revenues

Billing for smaller tasks, like quick phone calls or email responses, are easily missed during the reconstruction process.  Many of these entries may go unrecorded, thus resulting in missed billable hours by the end of the fiscal year. Alternatively, clients may thoroughly review how much time is being spent on each task for their case. If entries submitted are false, this may result in the loss of a client and ultimately loss of revenue for the firm.

 

Reputation at risk

The loss of a client can greatly harm a firm’s reputation.  Substandard billing practices increase billing disputes, create inaccurate records, and effects the trust and goodwill of client-firm relations.  Issues of ethical conduct may arise after billing miscalculations occur; remember, the greater the amount of billing miscalculations a client comes across, the greater the negative effect on a law firm’s reputation.  Handling your law firm with care means ensuring that all documented billable hours are accurate upon completion.

 

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