All systems go

There is a standard checklist of points to consider when buying probate software. But three key issues are consistently misunderstood: comparing the accounting system and case management, the myth of accounts integration, and training and leadership.

Most probate professionals refer to probate software as 'probate case management', whereas the bulk of probate work is an accounting function. Spreadsheets are useful, but an inherently high-risk tool next to a probate-specific double-entry accounting system.

Probate accounting involves a plethora of financial details, such as logging the assets and liabilities, separating capital and income and constantly recalculating the money due to the residuary beneficiaries among many others.

But these accounting functions cannot be performed easily by case management software, which is concerned with workflows, mail merge and task management. Its importance should not be underrated. The case management function is, at best, about 20 per cent of the estate administration, the bulk of which is accounting.

The fundamental question is: how useful is case management without an accounting system from which it can pull financial data and merge into your precedent template and output into a letter or an email? One discerning solicitor likened a case management system without being linked to a fully fledged accounting system to "trying to catch fish without bait".

Probate work requires both case management and accounting systems working in harmony. The result is a potentially profitable private client department. But 'probate case management' is a misnomer, so ask a future supplier whether they have a double-entry probate accounting system with integrated case management.

Integration myth

Many law firms use the buzzword 'integration'. It is a common assumption that the client ledger and probate client account should be one and the same. Can a probate team use the client account to record financial movements of the estate? Of course. The cashier/accounts department is primarily concerned with registering client monies in and money out of the practice management system client account. They are only marginally concerned with the actual breakdown of the funds received.

By contrast, a probate team will want to know, for example, the detail of the cheque or a money transfer from the stockbroker, the value of each share - How else will you know how much to pay the beneficiary who wants cash for a particular equity? - and the distinction between capital and dividend income. Or there's the payment from the deceased's bank account that includes both date-of-death amount and interest, especially when the statement arrives three weeks later.

The cashier is not fundamentally concerned with these distinctions, but a financial breakdown of each transaction must be tracked and recorded, ideally in a dedicated and therefore flexible accounting system.

A practice management system will not contain probate registries that can be 'clicked and picked' or a list of London Stock Exchange equities with correct Stock Exchange daily official list (SEDOL) and international securities identification number (ISIN) numbers. It is unlikely to enable, for example, maintaining a profit and loss account for each of 30 properties owned by the deceased, some with mortgages, and some lease-owned, each with various charges.

These features are of little relevance to other departments. A plethora of detail must be recorded in a probate accounting system that has no place in a firm's client account, and which is of minimal concern to the cashier.

The totals of the two client accounts will need to be reconciled from time to time, but trying to integrate them makes no sense whatsoever.

Lead by example

In Charles Christian's chapter on training in the Probate Practitioner's Handbook section 18.5.5 (The Law Society, 2006), he writes: "Left to their own devices, fee earners will often claim that they are 'far too busy' to attend training and then complain that the software is 'hopeless' when they later discover that they do not know how to use it."

Software training is underrated. It is an area where many firms try to make savings, but it is a false economy. If fee earners and support staff cannot use the software properly, it is a wasted investment. But this is only half the story.

Even more important than the training is ensuring fee earners actively use the software afterwards and are not tempted to go back to an inefficient way of working. Most of us enjoy the easy routine of a well-worn grove using familiar tools. Learning new systems is a nuisance, no matter what the potential benefits are. It is even worse when we are obliged to suffer a temporary decline in our productivity until we are familiar with the new system.

Strong departmental leadership would insist on fee earners enduring the learning curve, which could take a few months. It is the only way to ensure the success of a new system. The alternative is to risk failure and a waste of the money spent.

Service solution Lancashire­based Coupe Bradbury had been using software that provided rudimentary probate administration. It was not very sophisticated in dealing with the various forms of tax. It wanted a system that could manage trust administration as well as other private client work. The company also wanted to produce self­assessment returns and offer sophistication in dealing with various types of investments, such as open­ended investment companies with accumulated income. Probate manager Julie Bullough heard about Isokon while on a course. The firm has now been using the software for five years. She said: “The system meets all our requirements for dealing with simple and complex estate and trust administration and continues to be developed. “If we note something that the system does not deal with, this is taken on board immediately and included in the programme of development.”

Gregory van Dyk Watson is managing director of Isokon