When should my law firm outsource bookkeeping?

Misbah Jalal Siddiqui

When should my law firm outsource bookkeeping?

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Outsource Bookkeeping

Bookkeeping means recording financial transactions—and it’s distinct from accounting, or the active keeping of financial accounts.

So, how do you know if your law firm should outsource your bookkeeping? Below, we’ve shared a few common scenarios that indicate you should consider outsourcing.

If you’re putting off tasks

If your bookkeeping falls behind, it can be really hard to get back on top of the process. For instance, if you put off tracking your tax-deductible expenses until you’re doing your taxes, you’ll likely miss a few things.

And since timely, organized bookkeeping is a prerequisite for timely, organized accounting, falling off the bookkeeping wagon can usher in a whole host of other problems.

If you’re mixing personal and business finances

For small business sole proprietors or single-member owners of an LLC, it’s easy to mix your personal finances with those of your business.

But it’s important to record every transaction. Otherwise, you lose key information for assessing the health and growth of your business. And, if you’re ever audited, you’ll have a huge mess to untangle under stressful conditions.[1]

If you’re losing time to data entry mistakes

It’s human to make mistakes. But if they’re costing you a lot of time and money—perhaps because you’re not catching them until long after they’ve happened—then it’s time to reassess your bookkeeping practices.

This holds particularly true for double data entry, which offers double the opportunity to make mistakes.

Why outsource

Law firms outsource all kinds of tasks because it effectively saves them money. A lawyer’s time is valuable, and if too much of it is going toward administrative tasks, then that time isn’t being used in a cost-conscious manner.[2]

Instead, consider outsourcing or paying a set monthly rate for a practice management system. This approach can drastically reduce administrative tasks—including by streamlining your bookkeeping.


1. Why You Should Never Mix Personal with Business Banking
2. 10 Tips for Better Small Business Bookkeeping

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