Jay Holmes describes himself as an accountant that can see your business through the eyes of a bookkeeper, controller, CFO and CPA. He is process oriented with a keen eye towards efficiency. For Jay, there’s always a better way of doing things: Business strategy fuels him. Jay is both a LeanLaw Accounting Pro and a QuickBooks Proadvisor.
Law firms have unique forms of compensation. How do you help them organize and execute?
Compensation models can get overly complex and administratively cumbersome. Our goal is to give perspective and guidance towards the cost/benefit of gathering the necessary information to make specific models work well.
How do you advise your law firm clients with regard to IOLTA trust accounts?
At the end of the month, these accounts get an added level of reconciliation. It’s not enough that the balance in the IOLTA matches the liability account, we make sure we know who’s money came in and out. Creating a separate ledger ensures we always know who’s money is sitting in the account at all times.
How are law firm clients different from other clients?
Law firm clients have a greater level of detail needed in their accounting needs. Fees are generated from hours logged and expenses incurred. All of those things need to be carefully tracked so billings are correct. They also need an added layer of detail to their Trust Accounts. A standard bank reconciliation only gets you halfway there, knowing specifically, whose funds are in the account is equally important.
Why did you become a QuickBooks Pro Advisor?
Funny you should ask… here’s the story.
What financial information should an attorney be reviewing to ensure her practice is fiscally healthy? With what frequency should this data be looked at?
I think one of the most powerful tools out there is a budget. Often times an attorney’s revenue is not completely predictable. With the potential for large swings in revenue, having an annual budget broken down by month allows an attorney to manage their cash flow more effectively and make better long-term decisions about the firm.
If a principal attorney were to look only at one report, which is the most important?
This is a really hard question to answer because there really isn’t a magic report that covers everything. To get the clarity that is truly needed, I would review the Balance Sheet, a monthly P&L compared to budget and prior year as well as a Year-to-Date P&L compared to budget and prior year. Depending on the firm, I would also run a cash flow report. From there I would pull in a few other metrics that make the business run smoothly (realization, leads, etc.) that are not always an outcome of a financial report. Because no one report does the trick, we will often create a dashboard that pulls in the important areas of each of these reports into an easily digestible format that gives the clarity needed.
We have a slew of clients moving into QuickBooks Online from non-QuickBooks accounting platforms. What guidance can you offer to help them manage this migration.
Accounting is a system supported by strong processes. The goal is to understand and overcome how a new accounting platform fits into your already dialed-in processes. Once this is done, the migration becomes enjoyable because moving into a cloud-based environment affords greater flexibility and increases the speed at which things can get done.
Given an inherent bias that folks have who use QuickBooks Desktop over QuickBooks Online, what do you say to those considering moving online? Is the bias valid?
Regardless of what it is, change is difficult. Given that, we completely believe the benefits of moving online far outweigh the challenges created by adapting to a new accounting platform. As an indicator of this, Blueback Accounting only supports QuickBooks Online. We interact in a world where information needs to be at our fingertips to make decisions and run our businesses. We need accurate and real-time data wherever we may be, and QuickBooks Online delivers this exceptionally well.
What makes QuickBooks Online a better tool for small law firms?
The small firm’s most valuable asset is its size and ability to pivot and respond to the market and client needs. QuickBooks Online delivers agility to the small law firm at a very affordable price.
How is QuickBooks Online affecting the accounting community? Is it changing how bookkeepers and accountants interact with their clients?
QuickBooks Online is at the forefront of accounting change. We are just barely scratching the surface of the impact QuickBooks Online will have on the accounting community. QuickBooks Online has been extremely focused on speeding up the time it takes to record transactions. What used to take hours of time to record transactions manually now takes minutes. Speeding up the input rarely translates into a higher quality output so this has shifted the focus of attention away from the input and more towards the output. Relatively, we spend a lot more time looking at the end results to make sure the information that has come in is being recorded properly. The leap ahead of us is shifting most of that attention away from data validation towards advisory services that help business owners navigate the ever-increasing complexities of business and market competition.
Good bookkeeping seems to be about repeatable workflows. How do you get an organization trained when you start working with them?
I couldn’t agree more; accounting is dramatically eased by consistent workflows. We specialize in workflow design, and there is no better time to review current workflows than during a transition to a new software, whether LeanLaw or QuickBooks Online. We generate a process map of the current workflows through a conversation and then provide recommendations and workflow training to support the transition.
For more information about Jay Holmes, visit Blueback Accounting