'Firms don't have enough net cash to pay their next payroll' – what are the warning signs for the UK top 50?
LLP accounts reveal operating profit margins slipping, staff costs rising and a limited cash safety net at many firms
June 14, 2018 at 10:45 AM
2 minute read
The wealth of information in law firm limited liability partnership accounts offers an insight into the state of health of the UK's largest law firms – as well as the warning signs they need to be looking out for.
In this video, Smith & Williamson head of professional practices Giles Murphy talks to Legal Week editor-in-chief Georgina Stanley about the key takeaways from the 2016-17 accounts of the UK top law firms, ahead of this year's financial reporting season.
Topics under discussion include:
- How, despite an increased focus on efficiency and the introduction of new technology, operating profit margins are slipping year on year
- The limited safety net firms have in terms of their cash position
- How law firms compare to other professional services sectors
- The impact of startups, external investment and the Big Four on the legal market
- How firms can better prepare themselves for uncertain conditions and Brexit's impact
This is the second in a series of articles analysing the 2016-17 LLP accounts of the UK top 50, in association with Smith & Williamson. Other subjects under the microscope will include profit, debt and how the magic circle compares to the rest of the market.
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