Legal Fee Audits Are Healthy For Business Owners
Posted on: 14 February 2020
For business owners, it's often advised to partner with a single law firm for all their litigation needs. While this practice is recommended, it does sometimes open the door to excessive and duplicative expenses when it comes to legal fees. Legal fee audits are particularly helpful in this type of situation, as they offer the business owner a highlighted view of what they are paying for their legal services.
Legal Fee Auditing
In short, this process is a thorough review of the fees your company has paid to an attorney. The audit can cover a single case or go back over the life of the partnership. As a fully legal process, your company can initiate one of these audits if you have a suspicion that you are not being charged ethically for your legal services or simply to review where your money is going. The audit is generally performed, or overseen, by an attorney to ensure the cost breakdown is accurate and lawful.
Offers a Breakdown of Cost
A legal fee audit lets you see where every dollar of your money is going. With this information, you can track where you might be overpaying for legal services that you rarely use. You can then shift these extra funds to areas of litigation that you need to rely on more often, which leads the way to more efficient spending habits.
Can Free Money for Future Services
In the event an audit discovers that the legal firm has overcharged you, there are several steps you can take. If the extra costs were grossly negligent or intentional, you can cut ties with the firm and take legal action to recover the money. However, in the case of small mistakes, you can generally request that the firm apply the money to future services, which will help you reduce your expenses for future legal services.
Highlights the Need for Partnership Changes
All law firms have different strategies and processes when it comes to billing. You can use the results of the audit to determine if you should look for a new legal partner if you do not agree with the fee structure of the law firm. You can then use the findings from this audit to compare to any new firms you are considering a partnership with.
Remember, legal fee audits are not just about suspicion of guilt. They are an excellent tool for tracking and managing how your money is spent on your legal needs. Speak with an audit professional to learn more about the service.
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