Legal fee auditing is a process designed to ensure that clients are getting a fair shake from their attorneys. There's a lot more to a legal fee audit than just checking for problematic billing, though. Let's look at six goals that should be established for every audit.

Reconciling Records

Bookkeeping is an important reason for auditing legal fees, even in situations where clients are fairly sure everything is on the up-and-up. Large organizations with long-running legal needs often accumulate huge records of billings. Conducting your own audits of the fees you've been charged can help you avoid problems down the road with tax or corporate audits by straightening everything out early.

Identifying Inefficiencies

A close look at billings can help you identify where you may be purchasing too much in the way of services. For example, you might find that some of the services you're paying for are redundant. While this is unlikely to change existing bills, it's certainly a good starting point for planning your next year's budget. You may also find that freeing up money in the budget allows you to allocate more resources to other legal needs.

Providing Updates

The sprawl of a large legal case can make it hard to nail down what the ongoing costs are. The same applies to companies that have everyday needs. Regular audits can provide updates on current spending, and they also can help clients project where billings are headed.

Determining Insurance Requirements

When you send legal fees to an insurer for reimbursement, they may rightly want to know what they're supposed to be paying for and why. An audit can provide information that will allow a claims adjuster to understand and justify a claim. Unsurprisingly, insurance companies are often looking at the same questions that individual clients are considering, such as inefficiencies, fraud, and bookkeeping.

Recovering Fees

It's hard to request a refund on excessive fees until you have a number to work with. A legal fee audit can help you itemizes which billings you believe are problematic so you can present them to the firm that represents you.

Pursuing Lawsuits

This represents the worst-case scenario, but it does happen. Presuming you've given the law firm a fair chance to make things right, you may have to pursue action against them. An audit can be a very useful tool when trying to identify discoverable materials. With the threat of being better armed when you go to court, it may be possible to reach a fair settlement.