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Accruals and unbilled amounts

Generating Unbilled Amounts from Budget Data

Accruals | Generating Unbilled Amounts from Budget Data

note
This topic discusses the technical specifications for estimating unbilled amounts and relates only to months in which your law department does not gather unbilled amounts from any vendors, but instead calculates unbilled amounts from budget data.

Which budget is used?

The following logic determines which budget to use:
  1. If the accrual is created at the matter group (and not in individual matters), the matter group budget is used. There is only one accrual for all firms in this case.
  2. If the departmental budgeting module has been activated (on the Budget & Accrual Setup page, which is accessible to Company System Administrators only), the budget used is specified in the matter options:
    • The law firm matter budgets, or
    • The company matter budget. If the system is set up so that there is only one company matter budget for each matter, there will be only one accrual. If the system is set up so that there is a separate company matter budget for each firm, there will be an accrual for each firm.
  3. If the departmental budgeting module has not been activated, use the law firm matter budgets.
note
If the applicable budget has not been entered (or has not been approved if approval is required), the budget amount will be treated as $0 for purposes of estimating unbilled amounts.

Formulas for estimating the unbilled amount accrual within a matter

Budget is the law firm matter budget (fiscal year)
The unbilled amount is equal to:
  1. The sum of budget for months after the most recent service period end date through the accrual period (whether posted or delivery on hold) with a service period within the current fiscal year +
  2. Delivery on Hold Invoices within the current fiscal year +
  3. Any ACES withheld amounts (applicable only for the ACES LT fee arrangement).
Budget is the law firm matter budget (phased budget)
The formula is the same as for the law firm matter budget (fiscal year) above.
Budget is the company matter budget (all firms)
The unbilled amount is equal to the greater of:
The sum of budget for all months from the beginning of the fiscal year through the accrual period - the sum of approved and pending invoices (do not include Delivery on Hold Invoices are NOT included)
or
Delivery on Hold Invoices within the current fiscal year + any ACES withheld amounts
Budget is the company matter budget (one for each firm)
The formula is the same as for the law firm matter budget (fiscal year)above.
Formula for estimating the unbilled amount accrual for matter group
The formula is the same as if the budget is the company matter budget for all firms.
However, if departmental budgeting has not been activated for the matter group, there is no company matter budget for all firms. Instead the budget amount used will be the sum of any law firm matter budgets in the individual matters.

This article applies to:

  • Product: Legal Tracker
  • Audiences: Company