Travers Smith saw cash reserves drop by more than 40% during the last financial year, according to the firm's first limited liability partnership (LLP) accounts.

During 2008-09 the UK top 50 firm saw cash at the bank and in hand drop to £9.6m, down from £16.3m in the previous financial year. Operating profits fell by 44% to £21.3m, while overall profit for the financial year stood at £22.2m.

The firm also saw fee earner headcount reduce by 29 to 322 over the year, while support staff numbers were static, growing by one to 81. Overall, staff costs over the period grew by 1.8% to £26.1m.

The highest-paid lawyer at the firm received £700,000 in 2008-09, a 34% drop on the previous year's figure of £1m. When the firm reported its financial results for the year, average profits per equity partner stood at £470,000.

The LLP accounts also show the firm as having no bank loans.

Travers managing partner Andrew Lilley (pictured) commented: "Effectively, at any time cash at the bank and in hand will be linked to the number of big corporate transactions that we do. Last year that activity fell, so it is not surprising that cash reserves fell as well. The same can be said for our operating profit."

He added: "We have always tried to manage things prudently and in that way we were able to avoid any borrowings. Activity levels began to pick up again in October 2009 and we hope that will be sustained."