In-House Counsel

A retrospective on invoice review

By Rees Morrison

Most in-house lawyers at some point have to review bills from outside law firms (See my posts of Nov. 3, 2005: standardized practices (July 16, 2005: one of the most popular methods of controlling outside counsel costs.). Even with a fixed-fee arrangement, the department needs to receive and review bills (See my post of Sept. 13, 2006.). Some lawyers are expected to spend quite a bit of time on invoice approval (See my posts of Sept. 14, 2005 and May 1, 2006: time spent on invoice review.), which is easier to do if the bills come in a pre-defined format (See my post of Feb. 21, 2007.).

Ways to review bills are varied (See my posts of Oct. 15, 2007: inductive or deductive approach; March 23, 2007: some statistical analyses; Jan. 4, 2006: spreading acceptance of e-billing; and Dec. 11, 2006: my article with 13 ways to more insights from invoices.).

Others besides the lawyer responsible for the matter may also look at bills (See my posts of Oct. 15, 2007: client gatekeeper; and Nov. 10, 2007: three-way approval process for invoices: lawyer, client and finance.).

At least five posts address third-party bill auditors (See my posts of May 1, 2005: ROI from proprietary bill review services; Aug. 26, 2005: $3.3 million of bills reviewed per day; April 16, 2007: huge volume of bills audited by third-party bill reviewer; Dec. 4, 2006: cottage industry of bill auditors; and Dec. 16, 2007 #2: a law firm that reviews bills.).

Invoice review is a bumpy road (See my posts of March 1, 2006: economics look bad for invoice review; May 1, 2006: ability of generalist corporate lawyers to review some bills; April 23, 2006: UTBMS not up to the task but April 22, 2007 on bringing the UTBMS up to date; and July 3, 2007: criticism of savings on bill-review time from fixed fees; Nov. 28, 2007 on billing disputes, getting paid, and little difference in bill review; May 8, 2007 regarding duplicate payments of invoices; Nov. 28, 2007 with some complaints by law firms about reviews of bills.).

Full post as published by Law Department Management on March 02, 2008 (boomark / email).