In a sector where precision is paramount and compliance is non-negotiable, accurate time recording is far more than a back-office task – it’s a cornerstone of financial health, regulatory integrity, and operational efficiency. Whether you’re a fee earner, COFA, or managing partner, understanding the importance of robust time recording practices is essential to safeguarding profitability and ensuring your firm remains on the right side of the SRA Accounts Rules.
Protecting revenue and profitability
Time is a law firm’s most valuable commodity. Every minute spent on client work has the potential to generate income, but only if it’s recorded. Incomplete or delayed time entries can result in significant revenue leakage, particularly in high-volume practices or those with complex billing structures. Accurate time recording ensures that all billable activity is captured, enabling firms to invoice confidently and fairly. It also provides a clearer picture of matter profitability, helping partners make informed decisions about pricing, staffing, and resource allocation.
Supporting compliance and COFA responsibilities
The Solicitors Regulation Authority (SRA) places increasing emphasis on transparency and accountability in financial management. For the Compliance Officer for Finance and Administration (COFA), time recording data is a vital tool in monitoring financial performance and identifying potential breaches. Poor timekeeping can lead to inaccurate client account reconciliations, misallocation of costs, and even breaches of the SRA Accounts Rules. In contrast, a well-maintained time recording system supports audit readiness and strengthens internal controls therefore, giving COFA’s the confidence to fulfil their duties effectively.
Enhancing client relationships
Clients expect clarity. They want to understand what they’re being charged for and why. Detailed time records provide the transparency needed to justify fees and demonstrate value. This is particularly important in contentious matters or where fixed fees are being negotiated. Moreover, accurate time data can help identify inefficiencies or bottlenecks in service delivery, allowing firms to improve turnaround times and enhance client satisfaction.
Driving strategic decision making
Time recording isn’t just about billing – it’s about business intelligence. When analysed correctly, time data can reveal trends in fee earner productivity, matter lifecycle, and departmental performance. This insight is invaluable for benchmarking, forecasting, and strategic planning. Firms that invest in time recording systems – and embed a culture of timely, accurate entry – are better equipped to adapt to market pressures, manage growth, and remain competitive.
Mitigating risk in mergers and acquisitions
For firms considering a merger or acquisition, time recording data plays a key role in due diligence. Prospective partners will scrutinise billing practices, WIP recovery rates, and fee earner utilisation. Inconsistent or unreliable time records can raise red flags and undermine valuation. Conversely, firms with strong time recording protocols present a more attractive proposition, demonstrating operational maturity and financial discipline.
Final thoughts
At Hazlewoods, we work with law firms across the UK to strengthen their financial and operational foundations. Time recording may seem like a small cog in a large machine, but its impact is far-reaching. From compliance to client care, profitability to planning – it pays to get it right.
If your firm could benefit from a review of its time recording practices, or you’d like to explore training options for fee earners and COFA’s, our Legal team is here to help. Let’s talk.
