What Is WIP and Lockup in Law Firm Billing, and How Do You Shorten It?

How to calculate lockup from the billing reports

Lockup is two counts of days, added together. Both use the same yardstick, the fees the firm bills in an average day, and the yardstick has to stay the same every month or the trend means nothing. A/R days is the same arithmetic as days sales outstanding, counted on billed fees; WIP days applies it one step earlier, before the invoice.

• Fees per day: total fees billed over the last 12 months, from the billing system’s invoice register, divided by 365.
• WIP days: the month-end total on the unbilled time or WIP report, time and costs, priced at standard rates, divided by fees per day.
• A/R days, also called debtor days: the month-end total on the A/R aging report, divided by fees per day.
• Lockup: WIP days plus A/R days.
• Keep one row per month-end with every figure above, and split it by billing attorney: a steady firm-wide number can hide one partner’s growing WIP.

Illustrative example: a hypothetical firm billed $1,460,000 over the last 12 months, or $4,000 a day. At month-end its WIP report shows $180,000 at standard rates, which is 45 WIP days, and its A/R aging shows $240,000, which is 60 A/R days. Lockup is 105 days. If WIP days fall to 25, $80,000 that sat unbilled moves toward the bank once, with no new matter opened. Every number here is invented; the firm’s own replace them.

Why time sits unbilled: four stops between work and invoice

Time travels from the work to the invoice through four stops, and each has a different owner. Before changing anything, find which stop holds the most dollars.

• Late time entry. Time rebuilt from memory at the end of the day or, worse, the end of the month is late, and a Law Practice magazine article on time capture (September/October 2026) explains why it also comes in short: “We do not want to overbill, so we are conservative and underbill.” Under ABA Formal Opinion 93-379, a lawyer billing by the hour “may not bill more time than she actually spends on a matter,” which makes a record kept at the time of the work the firm’s best evidence of what was spent.
• Pre-bill review. The draft bill waits for the billing attorney’s free afternoon. A 2024 Law Practice article on billing leaks names the question to ask when bills go out late: “Are attorneys not reviewing pre-bills in a timely manner?”
• Held bills. A billing attorney holds a bill on purpose: the client is unhappy, the matter is nearly finished, a fee conversation is pending. Each reason can be sound. A hold with no release date is how time worked in one quarter gets billed in the next.
• Write-downs. A 2022 Law Practice finance column, written by a law firm’s chief operating officer, names three causes: time management, client relations, and business development, meaning reductions offered in hope of more work. The 2024 article adds one that leaves no trace: a timekeeper trimming their own time before anyone sees it, which leaves the billing attorney no record of the hours spent.

For a write-down that will happen anyway, the 2022 column’s advice is to show it on the invoice as a courtesy, because “Unseen write-downs/write-offs provide the law firm with no benefit.” Entered with a reason, it also leaves a record the managing partner can count by attorney and cause.

How many WIP days is too many: the firm’s own line

This guide gives no benchmark for it. A published figure describes other firms, other practice areas and other billing habits. The line that matters is the firm’s own, and it takes an afternoon to draw from reports the billing system already produces.

• Pull the WIP report and the A/R aging as of each of the last 12 month-ends. If the system cannot run them for a past date, start the row this month.
• Compute WIP days for each month-end with the same yardstick. The median of the 12 is the firm’s line, and the highest month shows how bad a bad month gets.
• Age today’s WIP by work date, 0–30 days, 31–60, 61–90 and over 90, and split it by billing attorney. With monthly billing, an entry should reach an invoice within one cycle plus the days the pre-bill is out, so anything older than 60 days has missed at least one bill run.

Too many, then, means two things the firm can see for itself: a month-end above its own median, and any entry older than two billing cycles without a written reason. The goal is a lower median next year than this year, measured the same way.

What the managing partner checks weekly, and the monthly reports

The weekly look takes one page, prepared by the billing person the day before and read on the same day each week:

• Hours entered last week, by timekeeper, against that person’s usual week. A short week is the first sign of time that will be rebuilt later or not at all.
• Entry lag: where the system stores the date an entry was created as well as the work date, the count of entries created more than two business days after the work.
• Unbilled time over 60 days old, by billing attorney, with a reason next to each matter.
• Pre-bills out and not returned, with the date each went out.
• Bills on hold, each with its reason and release date.
• Invoices more than 60 days past their date, each with a next step and an owner.

Once a month, after invoices go out, five reports carry the slower numbers: the lockup rows for the last 12 month-ends; billing and cash realization by billing attorney, which a 2023 Law Practice finance column defines as “the percentage of time billed to time recorded” and “the percentage of cash collected to time billed”; write-downs and write-offs by attorney and reason; the A/R aging report; and payments received against invoices sent. Two vendor-sponsored ABA Law Practice Division webinars drew similar lists: one in October 2025 named an unbilled activity report run as a final sweep before the monthly billing cycle, and one in May 2026 put unbilled work on the weekly list and cash lockup on the monthly one.

How to shorten lockup, one stop at a time

Each fix is a rule with a date and an owner, not new software. Start with the stop that holds the most dollars.

• Same-day time entry: each timekeeper enters the day’s time before leaving, and the weekly page shows who did. The 2026 Law Practice article recommends tracking time on flat-fee and contingency matters as well, to catch scope creep on a flat fee and to weigh case selection on contingency.
• A billing calendar with dates. For example: pre-bills out on the second business day of the month, back by the fifth, invoices out by the seventh. A lawyer writing in Law Practice magazine’s September/October 2025 issue puts it simply: “send your invoices promptly after the close of the billing month.”
• One named owner for the bill run, who sends the pre-bills, chases the ones not returned and lists every hold with its reason and release date.
• Write-downs decided at pre-bill by the billing attorney, entered with a reason and shown on the invoice. No timekeeper trims their own time.
• Flat-fee stages invoiced when the stage the letter defines is reached, and advanced costs passed through on the next bill, not at the close of the matter.
• A/R follow-up on a calendar: a reminder schedule by aging bucket, and a named owner for every invoice past 60 days.

WIP days are the half of lockup the firm controls outright. A/R days depend on clients, and the 2024 Law Practice article ties the two together, warning that a bill sent long after the work is less likely to be paid.

When not to hire anyone, and where the Review fits

If every timekeeper enters time the same day, pre-bills come back on the date set and lockup is steady against the firm’s own 12 months, there is nothing here to buy. A solo who bills their own time can run this page in an hour a month. A disputed bill, or a question about what an engagement letter allows, belongs with the firm’s attorneys or bar ethics counsel, not a consultant.

For a firm that cannot say how many days its money waits, the Revenue Review counts it under the Delivery → Invoice hand-off. From read-only billing exports, de-identified wherever possible, it rebuilds WIP days, A/R days and lockup for each of the last 12 month-ends, ages the unbilled time by billing attorney, and puts a dollar figure on the write-downs and on recorded time that never reached an invoice. No client names, no case files, no trust-account access, no client funds. It takes two weeks, and the written report is the firm’s to keep.

If the gap looks large, the next step is a free 20-minute call, where we say whether the weekly page above is enough on its own. Lumina is not a law firm and gives no legal or ethics advice, and below about $1 million a year in fees the Review’s price does not fit the arithmetic.