Law firm financial dashboard

Calculates from the numbers you enter. This isn't accounting or tax advice, and benchmarks come from industry surveys that vary by firm size, practice area, and market. Use this for a quick health check, not a substitute for your firm's actual financial statements. See our full disclaimer.

Enter your numbers for the period

Total value of billable time recorded ($) Hours worked multiplied by billing rate, before any write-downs.

Total amount actually invoiced to clients ($)

Total amount actually collected from clients ($)

Total revenue for the period ($)

Total operating expenses for the period ($)

Number of attorneys (for revenue per lawyer)

Your financial dashboard

Want a deeper financial health review?

A legal financial consultant can review your realization leakage, billing workflow, and overhead structure to find where revenue is actually being lost.

What do realization rate and collection rate actually measure?

Realization rate measures how much of the value of recorded billable time actually makes it onto an invoice, calculated as billed value divided by total value of time recorded. If attorneys logged $500,000 in billable time but only $440,000 reached client invoices, realization is 88%, meaning the missing 12% represents work performed but never billed, whether from write-downs, courtesy discounts, or stale time entries. Collection rate then measures how much of that billed amount is actually paid, calculated as collected value divided by billed value. Current industry data puts the average realization rate around 88% and the average collection rate around 93%, with a widely cited target range of 90 to 95% for a healthy realization rate specifically.

These 2 metrics compound. A firm at 88% realization and 93% collection is only converting about 82% of its theoretical billable time value into actual cash, before overhead is even subtracted. Overhead typically consumes another 45 to 50% of what's collected, which is why average law firm profit margins land around 33%, with top-performing firms reaching 50% or higher. Once you understand your numbers here, our legal time tracker helps capture more accurate billable time at the source, and our legal invoice generator helps move billed value into collected value faster.

Why does realization leak even when attorneys are working full days?

Because logging time and successfully billing for that time are 2 different steps, and problems can occur at either one. Common leak points include time entries that are too vague or made too long after the work to justify to a client, discretionary write-downs during pre-bill review, and courtesy discounts given informally without being tracked as a formal adjustment. Standardized billing practices and prompt, detailed time entry are consistently cited as the highest-value fixes for realization specifically.

What's considered a healthy profit margin for a small or mid-size law firm?

Most guidance places healthy small firm profit margins in the 20 to 40% range, with firms maintaining strong realization and collection rates often landing above 25%. The average across all firm sizes is commonly cited around 33%, so a firm below 20% likely has a specific structural issue worth investigating in overhead, pricing, or one of the upstream realization and collection metrics.

What is "lockup" and why does it matter for cash flow, separate from profitability?

Lockup measures how many days worth of annual revenue is tied up as either unbilled work or unpaid invoices, essentially how long it takes for completed work to become cash in the bank. A firm generating $50,000 in monthly revenue with 90 days of lockup has $150,000 permanently tied up in the pipeline at any given time. Reducing lockup, through faster billing cycles and more disciplined collections, and terms set clearly with our retainer agreement builder, frees that cash for operations without needing to increase revenue at all.

Frequently asked questions about law firm financial metrics

Not automatically, since some firms deliberately accept lower realization on certain matters for strategic reasons, such as building a relationship with a valuable long-term client. That said, an unexplained or declining realization rate, especially one below the 85% range cited as a common investigation threshold, is generally worth understanding rather than dismissing.

Utilization measures what percentage of a workday goes to billable work in the first place, before realization or collection even come into play. Industry data suggests attorneys average around 2.9 billable hours out of an 8-hour day, meaning utilization alone can be a major limiting factor on revenue even before considering how much of that billable time actually gets collected.

Both, ideally. Firm-wide numbers show overall financial health, but tracking at the individual attorney or even individual matter level reveals which specific relationships or practice areas are driving strong numbers versus quietly dragging the average down, a pattern that a single firm-wide figure can completely hide.

Yes, meaningfully. Traditional realization rate calculations assume an hourly billing model, so a firm doing significant flat-fee or alternative fee work needs a different or supplemental way to measure whether pricing is actually profitable, since the billable-time-to-invoice comparison doesn't map cleanly onto a flat fee arrangement.

Monthly review is common practice among firms with disciplined financial management, since realization and collection problems compound quietly and are much easier to address when caught early rather than discovered at year-end when the revenue is already lost.