Understanding UTBMS Codes

Across the legal industry, attorneys and corporations increasingly rely on digital technology for invoicing and billing. However, the transmission of invoicing and billing information requires the standardization of data into a uniform format and structure. The goal is to verify that billing practices in law firms are clear, consistent, and transparent, making it easy for legal departments in corporations and agencies to track costs and billable legal tasks.

The uniform task-based management system, or UTBMS, provides a standardized framework for legal professionals to categorize tasks and expenses. UTBMS codes in AdvoLogix invoice automation software enable in-house legal departments to process invoices accurately and get a clear breakdown of services outside counsel provides.

What Are UTBMS Codes?

UTBMS codes are a set of standards used for electronic invoices to classify legal tasks and services done by a legal service provider. They also outline how to categorize expenses related to legal matters.

Before the introduction of UTBMS codes, there wasn’t a universally accepted standard for how law firms and organizations could describe legal services. A billing standard was needed to make it easy for law firms to organize their billing data and for clients to understand, track, and compare the legal fees of different legal service providers.

In the mid-1990s, The American Bar Association, PricewaterhouseCoopers, and the Association of Corporate Counsel collaborated to create UTBMS codes. These codes provided unified electronic billing guidelines for law firms and legal departments.

Once the UTBMS project was completed, the LEDES Oversight Committee, or LOC, was formed. The goal was to create a standard format for the exchange of billing information between law firms and their clients.

What Is LEDES?

LEDES stands for legal electronic data exchange standard. It outlines globally recognized file-sharing formats for sending electronic legal invoices. LOC created the standard and first launched it in 1998.

When working with LEDES file formatting, legal practices use standardized billing codes to categorize tasks, activities, and expenses in law firm invoices. LEDES billing uses the UTBMS classification codes, making it easy to analyze legal bills.

What Are ABA UTBMS Codes?

The ABA UTBMS provides a series of standardized codes for organizing and describing legal services offered to a client. They provide the invoice recipient with information in a specific, standardized format that lets them quickly identify billed matter or activities. Developed by the ABA, they are among the most widely adopted codes for legal billing.

The UTBMS classifies the services performed by legal professionals into particular codes to be entered into LEDES invoices. As an example, consider the set of litigation codes, which is grouped into the five following basic aspects of litigation:

Case assessment, development, and administration
Pre-trial pleadings and motions
Discovery
Trial preparation and trial
Appeal

One of the codes under the Discovery subsection is L330 Depositions. If a lawyer conducted a deposition of a witness, that code would be entered into an invoice.

Categories of UTBMS Codes

UTMBS codes can be classified into three main categories:

Task Codes describe the legal services offered to clients in a particular area of law. UTBMS task codes classify legal work into specific tasks, such as document production and filing legal documents to respond to legal action in court.
Expense Codes categorize legal costs, such as travel expenses, court fees, and photocopying charges related to a particular case.
Activity Codes identify the specific action performed to complete a legal task. The action may include writing a document, speaking with someone relevant to a client’s case, or researching laws related to a particular scenario.

Why Are UTBMS Codes Important?

UTBMS codes can help streamline legal operations and benefit your department in multiple ways:

Standardization

UTBMS codes streamline legal billing by providing a universal framework for tracking legal services and the associated costs. As a result, law firms have common, structured guidelines to precisely identify the legal work they’ve done for clients. Therefore, organizations that hire outside counsel can account for all costs and track billable time accurately to avoid being overcharged by law firms.

Enhanced Transparency

Unstructured, inconsistent, and ambiguous billing information from law firms can leave corporations and agencies wondering: What exactly did we pay for? Are we being charged fairly? Billing conflicts may arise in such circumstances.

Since UTBMS codes outline every task legal practices complete throughout a legal process, they ensure law firm invoices are detailed and transparent. Meanwhile, as a client, you can access concise descriptions of the legal services you received, the associated costs, and the time spent on each activity an attorney carried out in your case. This clarity lets you clearly understand the work done and why it was necessary.

Quickened Invoice Review and Approval

UTBMS codes provide a standard structure for describing services offered in legal invoices. As a result, invoice reviewers in government agencies and big corporations can use the codes to understand the nature and scope of legal services provided.

The same structure for all legal invoices ensures reviewers don’t have to decipher varying billing descriptions or formats. Instead, they quickly verify the accuracy and reasonableness of billed hours, identify discrepancies swiftly, and resolve billing disputes efficiently and on time.

Consistency and Streamlined Collaboration

UTBMS codes improve collaboration between in-house legal departments and outside counsel. Because it provides a standard coding system for legal billing, both parties ensure consistency in billing practices and clarity on expectations related to invoicing.

Improved Cost Management and Expense Forecasting

UTBMS Expense Codes categorize expenses incurred during legal representation, such as court filing fees, deposition costs, and witness fees.

By assigning specific UTBMS codes to each expense, law firms can clearly indicate expenses related to serving your organization. This enables detailed tracking of expenses related to working with outside legal councils. Since the UTBMS codes provide one billing standard for the entire legal industry, companies can easily compare the costs of partnering with different legal service providers to choose the most affordable.

The ability to track legal costs at a deeper level enables in-house legal teams to better monitor expenditures across different legal matters handled by outside counsel. They can then use the insights to predict expenses in future cases that fall in the same category. That way, their budget allocation and resource planning become more informed and data-driven.

AdvoLogix Provides Advanced Invoice Automation Software

Repetitive, manual invoice processes consume a lot of time and effort. Their propensity to human error can lead to costly inefficiencies and inaccuracies when processing invoices from outside counsel.

LEDES billing software leveraging UTBMS codes can help streamline invoice review and approval. However, not all legal software solutions are equal. Some require you to input UTBMS codes manually, which can be tedious and time-consuming. Others can automatically apply UTBMS codes to invoices, reducing manual work.

AdvoLogix offers innovative invoice automation software that frees your staff from mundane manual tasks, speeds up invoice review and approval, and reduces the risk of human error in invoice processing.

Another reason to choose AdvoLogix over other options is that you gain access to powerful cloud-based tools you can tailor to your organization’s unique needs:

AdvoLogix Caster is an AI-powered solution that allows you to import invoices in bulk. It also allows you to customize billing compliance without relying on manual invoice processing and data entry. This tool is one of the common applications of AI for legal organizations.
AdvoLogix Matter Management Solution automates invoice workflows, centralizes legal document management, enhances teamwork, and offers customizable reports and dashboards.

To learn more, check out our reviews. Reach out to our team for more information about how Advologix automates and simplifies the legal billing process.