Starting your practice checklist In addition to brief guidance, the checklist provides links to numerous Queensland Law Society resources and external sites. Key action Notes and resources Compliance and notification Apply for a Principal practicing certificate To establish a practice by yourself, you need a principal practicing certificate. Application for upgrade to principal practicing certificate. To apply for a principal practicing certificate, you will need to complete or meet the requirements of the Practice Management Course. Organise trust account(s) If you are planning to operate a trust account, you should read the Trust accounting guidelines and the Guidelines for opening a Trust bank account. Notify the Queensland Law Society The Queensland Law Society Administration rule (s18A) requires solicitors to notify Queensland Law Society if they are changing employment or starting a new practice. Incorporated Legal practices (ILPs) should use Form 23 to notify Queensland Law Society of their intention to offer legal services through a corporation. Get Professional Indemnity Insurance All practices (other than some national practices) are required to obtain the compulsory level of professional indemnity insurance through the Queensland Law Society insurer, Lexon Insurance. Check the levy model, complete the Queensland Law Society/Lexon Professional Indemnity Insurance questionnaire or contact Queensland Law Society records department on [email protected] Top-up insurance is available from a number of providers. One of the leading brokers for solicitors in Queensland is Aon: please contact [email protected] Register with Australian Tax Office A new practice must meet the requirements of the Australian Tax Office, register for an ABN/ACN and tax file number and make arrangements regarding GST, payroll tax, BAS, superannuation etc. Adhere to practice obligations Reacquaint yourself with practice obligations in the Australian Solicitors Conduct Rules and Australian Solicitors Conduct Rules. Business planning and budgeting Write a business plan A basic practice business plan should address the practice’s goals, market analysis and SWOT analysis, marketing plan, operational plan, and financial plan. See the Queensland Law Society Business plan template and budget templates. More tools and information are available from the Queensland Government business site. Prepare profit/loss and cash flow budgets See the Queensland Law Society budget templates. See Queensland Law Society guide to costs, billing and profitability’ for tips on improving cash flow. Set fees and billing procedures Read ‘Queensland Law Society Guide to Costs, Billing & Profitability’ for guidance on fees and billing. Set Key Performance Indicators (KPIs) and benchmarks Key performance indicators (KPIs) and benchmarks can be very useful in managing your practice. Read the articles by Graeme McFadyen and Sam Coupland, and see how the Queensland Law Society/FMRC Legal Business Monitor can help. Practice structure Decide on structure Incorporated legal practices - read the Queensland Law Society ILP information kit before deciding to structure your practice as an ILP. Multi-disciplinary partnership - read the Queensland Law Society MDP information kit before deciding to structure your practice as an MDP. Queensland Law Society Law Practice structures factsheet ‘Practice structures, tax and asset protection’, by Chris Davis You should seek professional advice on structuring your practice. Partnership agreement Calculate the initial start-up costs How much money do you need to establish your practice? Prepare your personal and practice cash flow ‘An effective partnership agreement’, by Peter Lynch and Graeme McFadyen Business plan template Budget templates Practice cash flow – Even after allowing for start-up costs, you will likely be spending significant sums on operating costs before you can recover the fees related to these costs. Use the budget templates to estimate the time between incurring costs, billing of fees and receipt, and estimate what additional finance is needed to cover this gap. Personal cash flow – Even allowing for start-up costs and practice cash flow, it may be some time before the practice generates sufficient profit to pay you a salary and return a profit. Make plans to manage your personal cash flow. Source funding Law practices commonly use a mix of three main sources of finance: partner equity, loans (short, medium or long term) and leasing. ILPs can also seek external financing. Seek professional advice from your chosen bank or accountant in relation to practice funding. Practice name Name your practice You should ensure that there is nothing in your chosen business name that is false and misleading (see Australian Solicitors Conduct Rules). You should consider whether there are any existing legal practices – either in Queensland or Australia – who already use your preferred practice name, as this could be a future cause of conflict and possible legal action. Register trading names You need to register a business name with the Queensland Office of Fair Trading if you trade under a name that is not your natural or corporate name. Insurance and additional cover Queensland Law Society Limitation of Liability Scheme Read about the Queensland Law Society Limitation of Liability Scheme, and as appropriate, complete the application form. Workers compensation insurance All Queensland employers must have workers’ compensation insurance. Most employers insure with WorkCover Queensland, while a small number of large organisations have their own insurance. Succession risk and other insurances Would your business survive if you or a co-owner died unexpectedly, experienced a serious trauma or became totally and permanently disabled? Should you consider: income protection, practice overheads insurance, life cover, trauma cover, total and permanent disablement (TPD) insurance, key person insurance, equity protection insurance, income protection Future-proofing: managing your succession risk, by Don Pilcher Succession planning strategies, by Graeme McFadyen and Garry Moore. Banking General account Even if firm is one person, you will need to have (a) practice account(s) separate from personal account. Overdraft facility Again, keep clear division between personal and business. Consider your cash flow needs and negotiate with your bank. Trust account(s) If you are planning to operate a trust account, you should read the Trust accounting guidelines and the Guidelines for opening a Trust bank account. Staff costs Read the Queensland Law Society/Hays Legal salary survey and the Proctor article by Graeme McFadyen and Peter Lynch – ‘It’s not just about the money’. Employment agreements IR assist is an industrial relations and human resource advice service for Queensland Law Society members with reduced costs for developing employment agreements. Read also the Queensland Law Society Guide to the Legal Services Award in relation to terms and conditions for employing administrative staff. Superannuation Read about your Superannuation obligations arising from the Legal Services Award. Legalsuper is one of the leading providers of superannuation services for the legal profession. Workers compensation insurance Every Queensland employer must have workers’ compensation insurance. Most employers insure with WorkCover Queensland, while a small number of large organisations have their own insurance. Staff Clients and Business Development Existing clients and contacts What constraints are there on contacting or marketing to clients or contacts from previous employments – check any employment or partnership agreements, take advice where necessary, and negotiate as required. If/when you are free to do so, contact all former contacts and clients and advise them about your new practice Marketing and business development See the Queensland Law Society Guide to Marketing and Business Development for information on developing and growing your practice. IT and Communications Hardware Consider installation, training, warrantee, support Software choice Assess your needs in relation to precedents, client management, matter management, accounting, time recording, productivity reporting, office automation, document management, integration. See Legal Practice Management Software Solutions Review and develop a shortlist of potential providers and software solutions. Consider implementation, training, support. Back-up Hardware and system. Consider off-site back-up solutions. Telecommunications Phone provider / mobile provider / internet service provider / website hosting / installation. Premises and peripherals Premises ses and peripherals Consider your likely premises requirements in both the immediate short-term and also medium-linger term. Location? Layout? Term? Furniture package? Occupancy date? Upgrade terms? Flexibility? Termination & renewal? Can you work from home or use part-week serviced offices to reduce your overheads and commitments? Peripherals Furniture, printers, scanners, faxes, filing systems, safes or safe custody arrangements. Stationery Cards, letterheads etc. Find a supplier who can help you with all your design and print requirements. This checklist was adapted and developed from an earlier checklist developed by Peter Lynch of dcilyncon.
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