How Advocates Can Manage Cash Flow Effectively Under the 97-Day Payment Rule
The Evolution of Bookkeeping and Accounting: From Ledgers to Cloud-Based Insights


Introduction
Advocates in South Africa face unique financial challenges, particularly when it comes to cash flow management. One of the biggest hurdles is the 97-day payment rule, which often results in long waiting periods before receiving fees from attorneys. At GAS Accounting, we specialize in providing accounting services for advocates in Johannesburg and Cape Town, helping them navigate cash flow challenges and ensure financial stability.
Understanding the 97-Day Payment Rule
The 97-day payment rule refers to the industry-standard practice where attorneys delay payments to advocates for up to 97 days. This creates significant cash flow constraints, as advocates must cover their expenses (such as office rent, salaries, and tax obligations) while waiting for income to be received.
Common Cash Flow Challenges for Advocates
- Delayed Income – With payments coming in only after 97 days, advocates often struggle to maintain consistent cash flow.
- Irregular Revenue Streams – Unlike salaried employees, advocates rely on sporadic payments, making it difficult to budget effectively.
- Tax Obligations – Provisional tax payments and VAT compliance must be managed, even when cash is not readily available.
- Operational Expenses – Daily business expenses, such as legal research costs, professional subscriptions, and administrative fees, must be met while waiting for payments.
How GAS Accounting Helps Advocates Manage Cash Flow
At GAS Accounting, we offer tailored accounting and tax services for advocates in South Africa to help them maintain financial stability despite the 97-day payment rule. Here’s how we can assist:
- Cash Flow Forecasting and Budgeting
We provide cash flow management services for advocates, helping them:
- Predict income and expenses to avoid financial strain.
- Develop a budget that aligns with expected payment cycles.
- Identify peak and low-income periods to plan ahead.
- Tax Planning and Compliance
We ensure that advocates stay compliant with SARS while optimizing their tax position:
- Provisional tax management – Ensuring tax payments align with cash inflows.
- VAT structuring – Assisting VAT-registered advocates in managing VAT liabilities and ensuring they pay VAT on the cash basis and not the invoice basis.
- Maximizing deductible expenses – Helping advocates claim business-related expenses to reduce taxable income.
- Invoicing Strategies to Accelerate Payments
While the 97-day rule is standard, we assist advocates in improving their invoicing processes:
- Optimized invoicing schedules to ensure timely payments from attorneys.
- Tracking unpaid invoices to reduce outstanding debts.
- Setting Up a Reserve Fund
We help advocates build a financial safety net by:
- Establishing a dedicated savings fund to cover expenses during low-income periods.
- Advising on investment opportunities to generate passive income.
- Structuring emergency funds for unforeseen expenses.
- Access to Short-Term Financing Options
For advocates experiencing cash flow crunches, we guide them on:
- Using overdraft facilities effectively.
- Exploring invoice financing to receive advance payments against outstanding invoices.
- Structuring business credit lines without excessive debt risk.
Why Choose GAS Accounting for Advocate Accounting Services?
- Industry Expertise – We specialize in legal accounting for advocates in Johannesburg and Cape Town, understanding the financial challenges unique to the profession.
- Tailored Solutions – We provide custom cash flow management strategies designed for legal professionals.
- Proactive Support – Our team ensures that your tax and accounting needs are met on time, helping you focus on your legal practice.
Get in Touch Today
Don’t let the 97-day payment rule disrupt your financial stability. Let GAS Accounting help you take control of your cash flow, tax planning, and financial future. Contact us today for specialized accounting services for advocates in South Africa.
Contact Us:
📍 Johannesburg | 📍 Cape Town
📞 Call us: 082 702 6935
📧 Email us: hello@gasaccounting.co.za
🌐 Visit: www.gasaccounting.co.za