The Gazette 1961 - 64

deputation should take up as an additional matter with the association the question of doctors attending patients and making reports to insurance companies without the patients' consent. Wearing of robes in court by solicitors and District Justices On a report from a committee the Council decided to inform the District Court Rules Committee that as there is a division of opinion in the profession on the question of the wearing of robes in the District Court no rule should be made on this subject by the committee affecting solicitors having regard in particular to the absence of robing facilities in many country court houses. Co-option of new member. On the motion of the President seconded by Mr. Collins it was resolved unanimously under bye-law 38 that Mr. Raymond A. French be co-opted from the general body of the Society as a member of the Council to fill the vacancy caused by the resignation of Mr. de Vere White. Circuit Court Rules Committee It was unanimously resolved that Mr. Joseph P. Tyrrell be appointed as the Society's representative on the committee for five years from the expiration of his present term of office on the zyth January, 1962. Incorporated Council of Law Reporting It was unanimously resolved that Mr. J. B. MacGarry be appointed as one of the Society's members of the Incorporated Council of Law Reporting in place of Mr. de Vere White. Committee members It was resolved that Mr. Raymond A. French be appointed a member of the Court of Examiners in place of Mr. de Vere White and that the following members of the Southern Law Association be appointed to committees : Finance Committee—John F. Foley ; Privileges Committee—Gerald Y. Goldberg ; Court Offices and Costs Committee—Cornelius J. Daly. CONTROL OF DISBURSEMENTS IN A SOLICITOR'S PRACTICE The control of disbursements is very important since it is related to working capital. It is worth remembering that four out of five people who fail in business do so because of lack of working capital. In a solicitor's practice disbursements may be

classified as direct client disbursements (stamp duties, counsel's fees, court fees, etc.) and indirect disbursements (rent, salaries and other overheads). Probably the majority of solicitors do not distinguish between the two for accounting purposes. At the end of the financial year the total of direct and indirect disbursements is set off against income and profit is reckoned as the excess of income over all disbursements. It would, however, be better accounting practice to strike separate balances for (a) direct disbursements for clients against clients' disbursements received and (b) indirect disbursements against profit costs received, and to carry out this exercise more frequently than once a year, particularly in regard to the direct client disbursements received and paid. If disbursements are going out faster than they come in it may indicate an expansion in your practice ; on the other hand it may indicate loss of working capital. Disbursements for clients in advance of reimburse ment are in effect interest free loans. If you pay out counsel's fees, stamp duties or court fees for a client and wait a month, six months or a year until you recover the amount as part of a general bill of costs it may not matter very much in the particular case. If you do this for twenty, thirty or fifty clients the amount of these interest free loans can reach quite startling dimensions. In any efficient business there must be a satisfactory and efficient turnover of working capital. There should therefore be continuous and efficient control at the earliest possible stage. Six practical points are suggested : (1) An effective general office system for all cash and cheque transactions. Deviations from this system should be allowed only after consideration and if necessary, consultation with your auditor. (2) At the initial interview for any new business estimate the probable amount of direct client disbursements and probable duration of the matter. Where necessary request the client for prepayment of direct disbursements. If part only is prepaid inform the client that further interim disbursement accounts may be submitted. (3) Following on (2) establish an interim dis bursement bill system and carry it into effect when necessary—possibly at regular monthly intervals. Most clients prefer to pay their bills in small instalments rather than in one large amount. (4) Keep a continual check on unpaid, and more particularly undrawn, bills of profit costs. (5) Establish a regular system of furnishing bills of profit costs. Reminders should go out after 60, 90 and 120 days.