Why a Single Version of the Truth is vital for your legal practice
Monday 25 July, 2022
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Imagine you have a prospective new client and you’re doing due diligence. You’ve gathered reams of research and information, but after putting it all together you read it through again, key items have been redacted. Here and there, black bars cover words, phrases, names, numbers, and whole paragraphs, and suddenly you can’t see vital information. Now you can easily miss a conflict of interest or the political exposure of your prospective client.
Effectively, that’s what you risk when you don’t have a Single Version of the Truth (SVT) in your firm. Though it can be worse than that — at least on a redacted document you know something is missing. If you’re not working with a Single Version of the Truth, you often won’t even know that anything is wrong.
What is a Single Version of the Truth?
SVT is a standard and a practice that ensures all data remains consistent — information doesn’t exist in different versions in different places, nothing is diluted, corrupted, or duplicated, and all of the information in your firm remains:
- reliable
- accurate
- accessible
- timely
- relevant
SVT requires a central authority to act as the only source and the final word on all data, all documents, and all records in your firm.
Without it, a key file could exist in several different versions, and different people could believe that theirs is the correct one. An important piece of information could be present in one, and absent in another. That can wreak havoc not only for compliance, as in the example above, but also for billing, accounts, and practice management.
Compliance
It doesn’t take much for a crucial document or piece of information to get buried, lost, or left behind. A slight inaccuracy in file naming, forgetting to attach a file to an email, or saving something in the wrong place can be all that’s required for something important to go unnoticed — perhaps a conflict of interest, or a detail about a potential client that might make working for them more complex, or even completely untenable.
What’s more, your obligations to HMRC are vulnerable to similar mishaps. If your records are incorrect, and your VAT submissions are wrong, you risk fines (or worse). Which leads us to…
Billing
Obviously, legal billing is complex — if you want to present an accurate and professional-looking invoice to your clients you have to gather a variety of costs including disbursement, outlay and professional services. Now, if you’re trying to pull together a proper picture of your expenses and billable hours from records that are disparate and unclear, it’s very easy to end up charging too little or too much.
Accounts
Every organisation keeps track of its finances, but law firms also need to manage the accounts of their client files. Once again, there’s huge complexity and numerous moving parts there, as well as substantial regulation and scrutiny from the government and legal governing bodies.
Get your accounts wrong, and you can face financial penalties, reputational damage, disqualification, or even imprisonment.
Even if regulatory consequences aren’t threatening, the outcome of your cases can often depend on timely and accurate accounting, which is extremely difficult to maintain when records and documents are missing or in disagreement.
Practice Management
When it comes to making strategic decisions about the firm, you wouldn’t want to take any action without crucial performance data and contextual information. Fee earner performance, case duration, cash flow forecasts, and profitability will, among many other insights, inform the direction that you take. If you can’t rely on the data you have, or you can’t be sure that you have the full picture, then you could be basing your strategy on a fiction.
Over a 1000 law firms use Insight Legal to protect their Single Version of the Truth. To find out why and how, book your demo today.
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