Because Canadian lawyers are subject to strict and unique accounting, taxation and reporting requirements, cloud-based practice management systems designed for U.S. lawyers often are not good fits for them. For this reason, the majority of Canadian firms that have practice management software use on-premises systems, with PCLaw from LexisNexis leading the pack at a reported 13,000 law firm installations.
As of today, Canadian law firms now have a cloud-based alternative. CosmoLex is announcing the release of CosmoLex Canada, a version of its practice management software specially designed for Canadian law firms and hosted at a data center located in Canada. The software is designed to meet all Canadian accounting and law society guidelines, CosmoLex CEO Rick Kabra told me last week.
CosmoLex Canada includes several features that are unique to the practice of law in Canada. They include functions related to accrual accounting and trust accounting compliance, as well as tax functions designed to comply with GST/HST requirements for taxation of legal fees and disbursements and claiming input tax credits.
In addition to Canada-specific accounting, CosmoLex Canada includes the ability to create a complete set of compliance-report documents in conformance with law society requirements.
Because requirements vary among provinces, CosmoLex Canada allows users to select the province in which they are located, and then all accounting and tax settings are enabled to conform to that province’s requirements.
The software includes the ability to track taxes for time spent performing legal services and for costs incurred. Taxes are recorded at the time-entry level rather than added onto the invoice so that the time-keeper can decided whether the service or expense is taxable.
All data for CosmoLex Canada users is being hosted in a state-of-the-art data center located within Canada, because some law societies prohibit lawyers from using cloud systems that host data outside Canada. Anyone who logs in to CosmoLex from Canada will be automatically redirected to the Canada data center. Kabra believes CosmoLex is the only cloud practice management system with a data center located in Canada.
Kabra said his main goal in launching CosmoLex Canada is to give Canadian lawyers access to the benefits and mobility of cloud-based practice management.
“The unfortunate reality is that up until now Canadian law firms were a decade behind their American
counterparts when it came to modern legal technologies,” said Kabra. “They were essentially stuck with
a handful of desktop-based practice management options and didn’t have access to cloud technology.”