We’re halfway through the year—can you believe it? June is the perfect time to take a deep breath, step back from your billable hours, and give your firm’s financials a much-needed check-up. Whether you’re a solo attorney or managing a small law practice, doing a mid-year financial review now can help you avoid nasty surprises come tax time and set you up for a smoother, more profitable second half of the year.
So, let’s talk about what attorneys should be reviewing right now, and why these few hours of financial reflection could make a huge difference in your practice.
Why a Mid-Year Financial Check-In Matters
As a busy legal professional, your days are filled with client work, court dates, and case prep—not bank reconciliations or quarterly projections. But staying financially healthy isn’t just about surviving tax season. It’s about running a business that supports your goals, both professionally and personally.
A mid-year review lets you:
- Catch and correct any bookkeeping issues early
- Ensure you’re on track with estimated tax payments
- Assess profitability and cash flow
- Plan for the second half of the year with intention
Skipping this step is like driving a long-distance road trip without checking your fuel gauge—sooner or later, you’ll hit a bump you didn’t see coming.
1. Revenue and Collections: Are You Where You Want to Be?
Let’s start with the basics: how much money has come in, and how much has actually been collected?
Check in on:
- Total revenue year-to-date
- Outstanding invoices or unpaid retainers
- Collection rate (how much of what you billed has been paid)
If your collection rate is under 85–90%, it might be time to tighten up your billing and follow-up process. You may also want to look into automated billing tools or outsourced accounts receivable support. Because guess what? You can’t spend money that isn’t in your bank account.
2. Client Trust Accounting: Are You Staying Compliant?
This one’s huge—especially if you’re handling client funds. Improper trust accounting can lead to disciplinary action, even disbarment. No pressure, right?
Now’s the time to:
- Reconcile your trust account and ensure it balances to the penny
- Review your three-way reconciliations (required in most jurisdictions)
- Confirm that no client trust account was used for firm expenses
If any red flags pop up, work with your bookkeeper or accountant right away. Trust compliance isn’t something you want to “circle back” to.
3. Review Your Expenses: What’s Helping vs. Hurting
You might be surprised by how much you’re spending on subscriptions, tools, or services you’re barely using.
Look over:
- Office overhead (rent, software, staffing)
- Marketing costs and ROI
- Continuing legal education (CLE) expenses
- Bar association dues and memberships
Now ask: Are these expenses aligned with where you want to grow? June is a great time to cancel or re-negotiate unnecessary costs and reinvest in what’s working.
4. Taxes: Are You Ahead or Behind on Your Estimates?
Here’s a fun one (okay, maybe not “fun,” but definitely important): estimated taxes.
Attorneys, especially solos and partners in small firms, often pay quarterly estimated taxes. If your income has changed significantly this year, your estimated payments might need adjusting.
Review:
- Total income and deductions so far
- Payments already made to the IRS and your state
- Any changes in personal income or tax bracket
Working with your accountant now can help you tweak your next quarterly payment and avoid a painful April surprise.
5. Profitability by Practice Area or Case Type
Not all cases are created equal. Some might be profitable and smooth, while others eat up your time and pay peanuts.
Break down your revenue and hours by:
- Case type (e.g., criminal defense, family law, business litigation)
- Client segment
- Referral source
This analysis can reveal where your most profitable work is coming from—and help you focus your energy accordingly. Why keep chasing the work that drains you when there’s better work right in front of you?
6. Cash Flow and Budget Forecast
This is the time to get real with your cash flow. Pull out that dusty budget (or create one if you haven’t yet!) and look ahead.
Ask:
- Are there any big expenses coming up in Q3 or Q4?
- Are you prepared for any seasonal slowdowns?
- Do you have enough saved for taxes, bonuses, or business development initiatives?
Your accountant or bookkeeper can help you run cash flow projections, so you can go into the next half of the year with confidence instead of stress.
7. Goals and Growth Plans: Reconnect with Your “Why”
It’s easy to get caught up in the daily grind. But take a minute to ask yourself:
- Am I hitting the goals I set in January?
- Is my practice supporting the kind of life I want to live?
- Do I need to delegate more, raise my rates, or shift my focus?
A mid-year check-in isn’t just about spreadsheets. It’s about making sure your business is working for you—not the other way around.
Need Help with Your Mid-Year Financial Review?
If reading this has your head spinning, you’re not alone. Many attorneys didn’t go to law school to manage balance sheets and reconciliations.
That’s where we come in.
We specialize in bookkeeping and accounting for attorneys who want to grow their firms, stay compliant, and reduce financial stress. Whether you need help reconciling your trust accounts, analyzing your financials, or creating a smarter tax plan, we’re here to support you.
Let’s Make the Second Half of the Year Your Best Yet
Ready to get a clear view of your numbers and a plan that actually works?
Contact us today for a free consultation and let’s make sure your firm is on the right track for the rest of the year.