In The News . . . . Citi Private Bank’s Law Firm Group’s Survey Shows Expenses Ate Up Revenue Gains Based On Polling Results From 191 U.S. Law Firms

Receivable Collection Cycles With Clients Lengthened During The First Half Of 2019.

            In an August 21, 2019 article by Debra Cassens Weiss on ABA’s on-line journal, she reports on the results of a Citi Private Bank’s Law Firm Group’s survey of 191 U.S. firms, ranging from top-grossing to boutique firms.

            Although the polled law firms’ revenues grew 4.1% in the first half of 2019 (mainly due to billing rate growth of 4.6%), expenses also grew 5.9%.  That meant that the increase in expenses—mainly, 7.3% jumps in lawyer compensation—exceeded the revenue growth.  The survey also noted that collection cycles lengthened by 1.6% for clients.  The report cited e-billing systems and greater scrutiny of bills, with some clients unilaterally changing payment terms, as driving the receivable collection “lag.”