A Day in the Life of an Operations Director

Guest blog from ILFM Member, Karen Edwards. A day in the life of an Operations Director in a regional law firm.

A Day in the Life of an Operations Director and Compliance Officer

Being Operations Director at Hedges Law, I have a varied and busy workload that brings with it lots of rewards and, as you can imagine, no one day is ever the same! As well as being Operations Director, I am also our Compliance Officer for Legal Practice ("COLP") and Compliance Officer for Finance & Administration ("COFA").

For my COFA and legal finance side of the role I make sure I have continued professional development training and full membership with the ILFM! The support I have received from the membership team and tutors has been nothing but exemplary.

Operations Director and Compliance Officer

This means month-end, and the beginning of each new month, is a very busy time for me and the finance team.

As well as preparing all the usual month-end financial reports, there are various tasks that, as COFA, I undertake every month. This past month, we were also in the middle of our SRA Accounts Rules Audit, which, as you know, is a requirement under Rule 12 of the Accounts Rules (“to obtain and deliver an accountant’s report”), unless your firm is exempt.

There are many responsibilities of being a Compliance Officer for Finance & Administration (COFA), the primary ones of which are set out in paragraph 9.2 of the SRA Code of Conduct for Firms.

What a month as a COFA looks like

Here’s an example of what the beginning of a new month looks like for me as an individual in a law firm practice! The following is how just one day looked for me.

We are a hybrid workforce, and so after the school run, I always log on at home (I spend my time split between office and home office) and immediately set to work with our usual month-end schedule.

Firstly, our finance team provided me with our monthly 3-way client account reconciliation for review and sign-off, in accordance with Rule 8.3 of the Accounts Rules. I reviewed the documentation provided with the reconciliation to ensure any differences were investigated and resolved promptly.

In 2019, the SRA Accounts Rules were updated to give increased importance to operating a client’s own account, and more onerous record keeping and control requirements for firms to implement.

Within Hedges, we operate clients’ own accounts and, following the changes to the Accounts Rules, we updated our Practice Management System to create a central register of those accounts, which are also maintained on each individual matter. This was followed up by a documented process and training for all relevant employees.

My next task was to review those files on the register, as mentioned above, to ensure we are complying with Rule 10.

Rule 10 - Operation of a client's own account

 

I reviewed the files and reconciled each attorney accounts document with the bank (or building society) statements obtained for each account we operate.

Once I was satisfied that the accounts reconciled with each bank (or building society) statement, and the register of our invoices was up to date, I signed the accounts off. This  is something auditors will usually ask to review at each annual audit, and I have just completed a training video for our auditor, showing them how to do this.

Monthly Financial Reviews and Digitalisation

I select a sample of files for a monthly financial review. We have customised our Practice Management System to digitise our file reviews so that an electronic review is stored on each matter, as well as creating a central register of all reviews. In my opinion, digitalisation culture is here to stay, and we must adapt and change quickly, efficiently, and securely.

This electronic review allows me to send tasks and reminders to the individuals concerned should any corrective actions be required, and allow me to monitor when those are completed, or if any require chasing. File reviews are our early-warning system and, in light of the current Accounts Rules audit taking place, it really does help to pick up potential issues such as residual balances, ensuring bills are sent to clients (or other written notification of costs) prior to transferring any funds from client to office account, financial transactions being posted chronologically with the required detailed narrative, and identifying documentary evidence supporting the financial transactions requested.

Systems and Controls

Next, I undertake a review of our cheques and cash received register, which is stored online in a central drive. The SRA expects firms to have systems and controls in place for identifying client money when received in the firm, and for promptly recording the receipt.

To ensure compliance with Rule 2.3 of the Accounts Rules (“client money is paid promptly into a client account”), I review the dates that cheques were received by the firm, to when they were banked, ensuring the banking process is in accordance with our policy.

I am pleased to say, there are no breaches of our policy!

Later that day, I attended a meeting with one of our team leaders to review and update supervision processes, looking at how we can use our PMS to make this easier, as well as more compliant.

Our files currently have electronic supervision forms bespoke to each matter type, which can be broken down into sections, depending on the status of the file at any given time.

Automatic supervision tasks and alerts are set up at certain stages of a file, to ensure supervisors are reviewing files at critical times. The final topic for review concerned key dates, and changes to how we record them on a file, so that they are copied into a central team calendar, generating automatic reminders at the relevant times.

Once entered, these key dates are then visible on every matter, in every team calendar and in a central list view on our PMS, which I am then able to review every month, as part of my COLP role.  I followed this up by amending our process for recording and monitoring key dates and ensuring each member of the team is trained on the updated process.

I then spent the rest of my day reviewing our business intelligence dashboards and PMS reports to begin preparing my management accounts pack, ahead of our monthly finance meeting. This also enabled me to start preparing for our company meeting the following week, in which we share with our people how the firm is performing.

Towards the end of the day, my children come home from after school club and our sausage puppy goes wild with excitement when sees them! I think it is time for everyone’s supper!

Karen Edwards, Operations Director

Hedges Law