The entrepreneurial spirit is exciting. Among professionals, lawyers starting their own firms experience all of the excitement that comes with that spirit. They also face more regulatory challenges than other entrepreneurs. Those challenges are unique to the business of law and Jacques Tjonasan understands how to meet those challenges completely.
“Lawyers practice one of the most-highly regulated professions of all,” says the founder and principal of Accounting for Law. “Achieving and maintaining financial compliance for the Law Society and the Canada Revenue Agency is a huge responsibility and it is one that is outside the primary expertise of most lawyers. We take the burden off their shoulders and provide financial peace of mind for lawyers.
Jacques and his team of 15 bookkeepers take on that huge responsibility for 250 small and medium-sized legal firms between Kitchener and Ottawa. With its headquarters located at 100 King St in Toronto’s iconic First Canadian Place, Accounting for Law also has satellite offices in Mississauga and Pickering, with associates attending client sites in Oakville, Brampton and wherever their clients need them to be. Other ‘attendances’ or tasks are completed remotely using cloud-based accounting software.
As its broad geographical coverage indicates, the business has been growing year-over-year since Jacques founded the company in 2000. That growth can be attributed to changes in how accounting tasks are performed in law offices, Jacques’ own reputation and broader cultural shifts.
“We’ve managed to gain the confidence of highly demanding people in a highly demanding profession,” Jacques says. Jacques started his career in the early 90s, before computers were in wide-usage and before legal-specific accounting software was developed. He held full time bookkeeping and office management positions with several prominent law firms, including those of civil rights champions Clayton Ruby and Marlys Edwardh.
“After working for lawyers full time for several years, I realized there was less reason for small firms to have full time bookkeeping staff, so with Clayton Ruby as my first client, and referrals from him, I made the decision to start Accounting for Law to serve those small firms,” Jacques remembers. “That was 2001, before there were smart phones, before there were cloud-based technologies. Lawyers weren’t interested in having some unknown person dial in and work remotely on their books, so the business was me, flying around from office to office taking care of everyone. Then, in 2010, everything changed and the comfort level with confidentiality and the use of technologies gained broad acceptance.”
That broad acceptance of technology has enabled Jacques to offer his clients a high level of service with a significantly smaller time investment. Accounting for Law manages payroll for about 60% of its clients, for example. A specialist, working in a central location can manage those tasks for more than 120 firms each month. It’s a trend Jacques believes will continue.
“On the bookkeeping landscape, we see more technologies on the horizon,” Jacques says. “What’s different for lawyers is the level of regulation and you need a human to be certain that those regulations are met, so there have been fewer advancements in legal accounting software than in other types, but through recent advancements, especially in remote access and cloud-based software, a 6 hour appointment is now a 3.5 hour appointment. Costs are down, but the contact and service are still there.”
The requirement for adherence to sound bookkeeping practices is especially serious in the practice of law. Legal fees are high and consumers need protection to ensure those fees are properly managed and properly billed. And, for the most part, consumers get that protection. Under the auspices of the Law Society of Ontario, each new law firm is subject to a spot audit in its first 12 months of operation and again every five years after that. If a firm is found to be non-compliant, the consequences can be severe.
“There are tremendous implications that come with the failure of a spot audit,” Jacques says. “It can result in the freezing of trust accounts that are used to manage client retainers and it can also result in an appearance in front of the disciplinary tribunal and license suspension.”
If the partners of a firm are called before the Law Society tribunal, and found wanting, a disciplinary note related to their financial accounts can be placed on their listing in the Law Society’s online database. That database is the best known and most reliable tool consumers can check before retaining the services of a law firm. Law firms engage Jacques and his team of career legal bookkeepers to keep their accounts in order and protect themselves from these kinds discipline.
“Ninety percent of our work is on what we call ‘monthly routine’ to complete required tasks that ensure the firms we work with are compliant,” Jacques says. “The other 10% is work with lawyers who need help catching up to bring them into compliance with the LSO and CRA. Where there has been severe noncompliance, the Law Society will call in a forensic investigator and we would work closely with them to bring the firm into compliance.”
Jacques credits his staff with being able to offer the attention to detail demanded by both the legal profession and its regulatory bodies.
“All of us have spent our careers working in the legal bookkeeping field,” Jacques says. “The focused experience helps us to identify what type of lawyer we are dealing with and what their expectations are. From there, we define a critical path and plan for working with them. We also understand that when our clients have questions, they are looking for an immediate response. We govern our treatment of lawyers by the same standards that govern how lawyers treat their clients. These are practice standards that we share with them and by following that standard we exceed our clients’ expectations.”
Kate Baggott's technology and business journalism has appeared in the Technology Review at MIT, the Globe and Mail, Canada Computes, the Vancouver Sun, and on the Business to Business News Network
Kate Baggott is the author of two short story collections.