Is your legal software ready to remain compliant in 2019?
In association with Insight Legal Software: facing supplier and regulatory changes, firms should check the future prospects for their systems
The legal software market is amidst a period of change and consolidation. Previously, most suppliers tended to be owner-managed businesses. However, today’s landscape is very different, with a good number being bought up by venture capitalist-backed businesses looking to consolidate the market and drive product development. This focus on a dramatically reduced number of “go-forward” products has created threats to existing solutions in use across many firms.
While older products may be supported by suppliers in the short term, many won’t receive the active development needed to keep pace with industry changes, and could be “end-of-lifed” in the future. Users therefore risk either not being totally compliant or having to employ workarounds to make them both function and comply.
Making Tax Digital
More change is increasing the pressure on firms to digitise. For example, HMRC’s Making Tax Digital (MTD) initiative launches on 1 April 2019 and is set to make fundamental changes to the tax system.
MTD will require firms to record and report their VAT transactions digitally. Firms must have suitable software in place that is capable of recording all VAT transactions and submitting the data to HMRC via a new Application Programming Interface.
With paper only records no longer acceptable, firms should check the status of their systems, ensuring they have the controls to maintain an efficient and compliant operation.
With products already in use by firms possibly no longer being supported, firms that don’t ask questions of their providers risk breaching legislation or incurring higher fees.
For example, an existing supplier could request that they change to an alternative system, at a large expense to the business. Keeping their existing system could mean they simply won’t be compliant from the moment any new legislation takes effect, or are forced to buy expensive “add on” products which have a limited lifespan and are cumbersome to implement and use.
The process of implementing and migrating data to another system could also be overlooked. Data migration takes considerable time and resources to make sure it’s done right. Leaving this close to regulatory deadlines, or incomplete before systems cease, could force firms to accept high renewal or migration fees, or even a lengthy agreement on a solution they aren’t fully satisfied with.
Taking active precautions, such as asking suppliers about the state of existing software or seeking advice from legal IT experts, will help firm managers to make early decisions about the best course of action when faced with potentially outdated or non-compliant products. Taking these steps now could help firms to reap the benefits of providers which offer fast migration with full support and expertise, giving their practice maximum compliance and longevity and allowing them to thrive in an increasingly digital sector.
Tim Smith, Technical Director at Insight Legal Software Ltd. To discuss this topic further or the services they offer, please call Insight Legal Software on 0141 406 1355, email email@example.com or visit: www.insightlegal.co.uk