The Gamble, page-57

Yes, it is. Time sheets are a measure of how one has occupied their time for the day, matters worked on, and to where that effort should be allocated (to which matters, for what purpose, etc). It is not a proxy for either revenue or conversion to revenue.

The profession is littered with examples (particularly in CBD /national firms) of matters being invoiced to clients at 65% of WIP or less. Generally however the correlation will be stronger (ie: WIP to conversion) outside of litigation /PI / Family Law matters. The reason - non litigation /non-Family /non-PI matters are more prone to estimates being done, fixed or agreed fees applying, budgets being set, or routines being repeated (ie: conveyancing matters). That's how most commercial work is done (of which SGH has very little, indeed).

With PI matters, the tendency is to collect and record the time effort but then adjust this when the matter addresses /resolves. It is not and never has been the case that PI matters will attract the 25% uplift above what's already there. Just as you can over-capitalise your home relative to your street or suburb, so too you can over-capitalise the invested effort into various PI matters.

Beyond this, there then becomes the inevitable tussle between costs billed and costs recovered. Not all costs can be recovered from the insurer etc (where typically, these are restricted to protocol costs, party /party costs, etc). Often, in the absence of there being agreement, the risk of having the fees costed (Costs Court) is quite high. The problem however with such agreements is the required compromise that is often necessary. Groups like the TAC and VWC already have very detailed cost protocols in place, so they know broadly what's the norm vs what's not.

Most of SGH's WIP is tied up in PI matters. From a WIP perspective, the GL areas are quite lean.

So, yes, using time sheets (for example) to apportion both cost and revenue is quite dangerous on the revenue side absent there being considering buffering in place.