Death and taxes: UK legal and accountancy firms hand over £19bn to the public purse

Death and taxes: UK legal and accountancy firms hand over £19bn to the public purse

The legal and accounting sectors contributed an eye-catching £19.1bn in tax to the UK economy in 2018, suggests a new report from lobby group TheCityUK.

The report published today (18 July) estimates the figure to be a 6.8% increase since 2016, with law and accountancy firms’ business models resulting in a higher tax contribution compared to their corporate counterparts. Firms’ employment taxes made up the lion’s share of the payments, measuring at £7.4bn, with partnerships providing a boon to the public finances. Continue reading “Death and taxes: UK legal and accountancy firms hand over £19bn to the public purse”

More law firm insolvencies expected as funding options tighten for smaller firms

More law firm insolvencies expected as funding options tighten for smaller firms

The number of law firm insolvencies is expected to increase after nearly doubling to 39 in 2018, as tightening margins, succession issues and more difficult access to funding put pressure on high street firms.

Statistics from the Insolvency Service show the number of solicitor firm insolvencies was up 70% in 2018, from 23 in 2017. The previous high was 34 in 2014, while as recently as 2010 there were no recorded law firm insolvencies. Continue reading “More law firm insolvencies expected as funding options tighten for smaller firms”

Apathy and a multimillion-pound shortfall define beleaguered KWM Europe insolvency

Apathy and a multimillion-pound shortfall define beleaguered KWM Europe insolvency

Thomas Alan finds reality setting in for creditors and former partners more than two years on

‘My immediate thought was: “Can’t we just move on?” I can’t be bothered with it,’ says one former King & Wood Mallesons (KWM) Europe and Middle East partner when asked for their thoughts on the firm’s latest administration report. Indeed, it is hard not to share some of the sentiment. Two years after the collapse of KWM EUME, the saga continues to limp forward in a fashion considered onerous even by law firm insolvency standards. Continue reading “Apathy and a multimillion-pound shortfall define beleaguered KWM Europe insolvency”

Watching the watchmen – inside the growing market for legal advisory work

Watching the watchmen – inside the growing market for legal advisory work

It used to be that law firms were rather more comfortable doling out advice than receiving it, but in an increasingly complex and regulated environment, major law firms can no longer make do bluffing their way through. Given that corporate governance at law firms can often be much less virtuous than the example they preach to their clients, it takes a certain kind of tenacity for the growing band of advisers to the legal industry to influence their clients.

As Iain Miller, regulatory partner at law firm Kingsley Napley, puts it: the professionalisation of risk management over the last five to ten years has been ‘huge’, which has encouraged a fertile breeding ground for advisory firms offering services in the legal sector. Continue reading “Watching the watchmen – inside the growing market for legal advisory work”

Sponsored briefing: Managing financial and employee risks in the legal sector

Sponsored briefing: Managing financial and employee risks in the legal sector

Aon’s Giles Bentley examines the financial and employee risks facing law firms

Giles Bentley, managing director and head of professions at Aon – a leading global professional services firm providing a broad range of risk, retirement and health solutions – gives insight on some of the biggest financial and employee risk questions facing law firms in today’s market. Continue reading “Sponsored briefing: Managing financial and employee risks in the legal sector”

KWM administration report shows £18.3m hole for creditors as former staff set for payouts

KWM administration report shows £18.3m hole for creditors as former staff set for payouts

Two years after the collapse of King & Wood Mallesons (KWM) the saga rumbles on, with administrators primed to pay former staff as an £18.3m funding deficit leaves unsecured creditors out of pocket.

A progress report filed last week details how some former employees of the firm have been ranked as preferential creditors following KWM’s 2017 insolvency. These employees will now be eligible for successful claims on failing to consult on the redundancy process, as well as payouts on wages and holiday pay. Continue reading “KWM administration report shows £18.3m hole for creditors as former staff set for payouts”

NRF partner promotions delayed as firm moves to US financial reporting ‘to align with the global business’

NRF partner promotions delayed as firm moves to US financial reporting ‘to align with the global business’

Norton Rose Fulbright (NRF) is shifting its financial reporting to the US calendar year-end in a symbolic move towards a more integrated business.

The move, which the firm describes as a bid to align the European operations with the global business, also means NRF will not be announcing Europe, the Middle East and Africa (EMEA) partner promotions until December this year. Continue reading “NRF partner promotions delayed as firm moves to US financial reporting ‘to align with the global business’”

Come together – Bakers unites UK and EMEA under single profit pool but Germany and France stay out

Come together – Bakers unites UK and EMEA under single profit pool but Germany and France stay out

Integration has long been one of the key issues for Baker McKenzie, a firm with heritage as a franchise and a long fight against the much-loathed ‘McFirm’ tag. A sign that things are changing came in February, when Legal Business reported that the firm is to bring London and eight of its offices in Europe, the Middle East and Africa (EMEA) into one profit pool – a landmark step towards full financial integration in the region.

Global antitrust chief Fiona Carlin has been elected to lead the integrated business, uniting 1,000 lawyers in the City, Brussels, Amsterdam, Stockholm, Madrid, Barcelona, Johannesburg, Bahrain and Qatar. Continue reading “Come together – Bakers unites UK and EMEA under single profit pool but Germany and France stay out”

Comment: Slashing to victory – the most dangerous law firm myth

Comment: Slashing to victory – the most dangerous law firm myth

‘Turnover for vanity, profit for sanity.’ How many times have you heard that phrase or variations of the theme espoused in the legal industry? A lot since the banking crisis recast the profession.

Commercial firms are forever chasing the grail of higher profitability to the extent of fashioning strategy around the notion of slashing the business to achieve it. People used to forecast consolidation and the dawn of the $10bn law firm – now it is as common for law firm leaders to talk of City-bred institutions getting smaller. Continue reading “Comment: Slashing to victory – the most dangerous law firm myth”

Slashing to victory – the most dangerous myth

Slashing to victory – the most dangerous myth

‘Turnover for vanity, profit for sanity.’ How many times have you heard that phrase or variations of the theme espoused in the legal industry? A lot since the banking crisis recast the profession.

Commercial firms are forever chasing the grail of higher profitability to the extent of fashioning strategy around the notion of slashing the business to achieve it. People used to forecast consolidation and the dawn of the $10bn law firm – now it is as common for law firm leaders to talk of City-bred institutions getting smaller. Continue reading “Slashing to victory – the most dangerous myth”