1. Home
  2. Billing
  3. Time and Expense Entry
  4. Billing Methods in CosmoLex

Billing Methods in CosmoLex

Introduction

Different practice areas may be billed using different billing methods, like Hourly, Fixed Fee, and Contingency billing.

When creating a matter, you will want to select the appropriate billing method. This will help you automatically enable the settings you’ll need for correct billing practices.

Before Getting Started

Set up standard rates for timekeepers. Not sure how? Learn more here. 

 

Hourly Billing

The most commonly used billing method, hourly billing requires time tracking at specified rates. Anyone in the firm can be a timekeeper if they are billing the matter for their time. The typical fraction of an hour is 1/10th (.1 or 6 minutes) with a minimum for any particular task. For example, a firm might establish that emails have a minimum time of 3/10 (.3) hour. Instead of time, firms may also choose to bill by task rates.

Additionally, hourly billing often includes billing for expenses. 

When generating an invoice, time and expense entries will make up the total.

Steps for Setup

Select the correct billing method for the matter. Learn how to Add and Manage Matters.

Fixed Fee Billing

There are many times when setting a fixed fee is appropriate. These are usually task-oriented matters where the amount of time the task requires is generally “fixed” so the attorney can gauge a profitable fee based on the work.

When you select this method, CosmoLex automatically makes any time entered for the matter “Unbillable.” This makes it possible to still track time for internal purposes (profitability tracking, or internal time tracking), but not bill the client for the separate work.

When generating an invoice, the total will consist of the fixed fee designated for the matter, as well as any expenses entered. 

Steps for Setup

Select the correct billing method for the matter. Learn how to Add and Manage Matters.

Edit Fixed Fee on Matter

If you have an instance where, along the course of a matter, the fixed fee amount changes you can easily edit your matter to make the change.

If you haven’t billed for the fixed fee yet

1. From the Matters tab, select your desired matter and click  Edit

2. Change the fixed fee amount to the new desired amount

3. When ready, click Save.

If you’ve already created an invoice for the fixed fee

You can choose to follow the same steps above. If the new amount is greater than the previous amount, the difference will appear in the unbilled balance.

Or, you may choose to delete the invoice and create a new invoice for the full ‘new’ amount. Don’t know how to delete invoices? Learn more.

Contingency Billing

When a matter is taken “on contingency,” the fee is based upon a percentage of the total settlement, judgment, estate administration, or other example.

When you select this method, CosmoLex automatically makes any time entered for the matter “Unbillable.” This makes it possible to still track time for internal purposes (profitability tracking, or internal time tracking), but not bill the client for the separate work.

When generating an invoice, the total will consist of this contingency fee and any expense cards entered.

Steps for Setup

Select the correct billing method for the matter. Learn how to Add and Manage Matters.

You can choose to enter only the percentage agreed upon, when creating the matter. Then, come back at the end of the case and enter the judgement in order to calculate your final fee.

Billing Workflow Tip

When creating a new matter, you will likely not be aware of the final judgment amount from which you will be taking a percentage. You can just enter your percentage, as shown above. Before you are ready to invoice, edit the matter in question and enter a judgement amount, also shown above. That will automatically calculate your Final Price or Fee, which is what will appear on your invoice.

Hybrid Billing Methods

There are times when you may anticipate that a fixed fee matter will turn into an hourly matter. Or, you may possibly have a matter that includes various items tracked as fixed fees and other items tracked hourly. 

We recommend that you track client matters separately, but still you may decide that certain tasks are to be tracked within one client matter in CosmoLex. Currently, we do not have hybrid billing methods available, however there are ways you can accomplish hybrid billing for your matters.

There are various ways to approach this, and so we recommend that you contact our support team directly to find the best way for your intended purpose.

Edit Billing Method

You can edit the billing method on a matter only if:

  • You haven’t yet produced an invoice for it. If you have already generated an invoice for the matter, you will need to delete it first. Learn how to delete invoices. 
  • You haven’t yet entered billable time entries (on an hourly matter). You’ll have to make those time entries unbillable first, before changing the hourly matter to Fixed Fee or Contingency.

1. From the matters tab, select the desired matter and click Edit

2. Change the Billing Method

3. Click Save

Learn More

Add and Manage Matters

Set Up a Matter-Specific Billing Rate

Billing Workflow in CosmoLex

Generating Single and Multiple Invoices

Updated on October 10, 2018

Was this article helpful?

Related Articles

X
X