Earlier this year, the LEDES Oversight Committee (LOC) ratified a new UTBMS code set for categorizing work done on mergers and acquisitions (M&A).
The M&A code set provides corporate clients with increased transparency into their spend on the specialized, and often costly, work done by outside counsel in this increasingly important practice area. It also gives law firms a new opportunity to demonstrate the value they provide to clients. Rising costs associated with M&A work make this a particularly high-stakes area of the outside counsel-client relationship, and leveraging UTBMS code sets offers law departments insights needed to evolve beyond the cost center model to become true business partners within their organizations.
A Little History About the Codes
According to UTBMS.com, UTBMS codes were introduced in the mid-1990s when law departments and insurers in the United States were looking for a way to gain a better understanding of the work done by their outside counsel firms. The goal was to standardize submission of electronic invoices so corporate clients could more consistently enforce billing guidelines. A committee was formed to create the initial standardized UTBMS codes, and they have continued to add new code sets as legal and claims departments expressed needs.
Better Coding for Better Metrics
In the years since they were introduced, the use of these codes has progressed far beyond the need for streamlined billing and invoice review. Because law firms can code every specific task performed, legal departments can use the information gleaned from invoices to build detailed reports that provide insight about budgeting, staffing, efficiency, and other operational considerations. These insights inform decisions by legal department leaders that define litigation strategies, improve outside counsel relationships, and help to meet overall corporate business goals. On the law firm side, coding this information not only supports client goals, but also allows firms to capture valuable information about how lawyers are spending their time.