Insights
Why an accountant’s cash flow looks nothing like a law firm’s
Same broad category, completely different revenue pattern. What matters to a lender isn’t the profession. It’s how consistently the money lands.
Two firms can bill the same amount and borrow very differently. An accountant with a growing advisory arm and a sole-practitioner lawyer billing per matter won’t be viewed the same way, even at similar turnover. The reason is how often, and how predictably, the money lands.
Why does transactional versus recurring income change how lenders see you?
Tax accounting used to be the definition of transactional: clients once a quarter or once a year. That’s changing. Plenty of practices now add advisory, virtual bookkeeping and other monthly services to smooth out the seasonal spike. Every recurring dollar helps with a lender, because predictable income is easier to lend against, and more products open up as a result.
Where do accounting, legal, broking and consulting sit on that spectrum?
Accounting and bookkeeping is traditionally transactional, increasingly recurring via advisory and virtual bookkeeping arms. Legal services are often transactional per matter, though retainer-based firms carry more recurring income, and the gap can run long: about 30% of Australian law firms report bills outstanding beyond 90 days, against a 40-day average for the rest of the economy, per the Law Society Journal. Finance and mortgage broking is commission-driven and often lumpy. Management and business consulting is a mix of project-based and retainer engagements, with larger firms leaning recurring. Architecture and engineering is typically project and milestone-based, with cashflow gaps between stages common. None of these are fixed categories. They’re a spectrum, and where your business sits on it is what a lender is assessing.
| Revenue pattern | Typical fit |
|---|---|
| Ongoing working capital buffer | Business overdrafts or lines of credit |
| Recurring client revenue on 30-90 day terms | Invoice finance |
| One-off need (fit-out, software, hire) | Unsecured business loans |
| Equipment, vehicles or technology purchase | Asset finance |
Which two products get used most in this sector?
Most professional services businesses are looked on favourably by non-bank lenders, so there’s a good choice of options. In practice, two do most of the work. Overdrafts and lines of credit, because they’re quick to set up and you draw only what you need. And invoice finance, for larger firms billing a spread of clients on monthly, 60 or 90 day terms. It turns receivables into working capital for hiring or growth. See our invoice finance page for how that structure works in practice.
When finance isn’t the right call yet
If your revenue is still highly seasonal or transactional with no visibility on the next engagement, taking on an overdraft or line of credit to smooth cashflow can help, but it won’t fix an underlying pipeline problem. Be clear on whether the gap is timing or something more structural before you commit to a facility. Say so on the call, and we’ll tell you which one it is.
Not sure how your revenue pattern reads to a lender?
Tell us how your income arrives (transactional, recurring, or somewhere in between) and we’ll tell you which products are realistic right now.
Frequently asked questions
Give us the basics below and we’ll call you within the hour, or at the time you choose, then come back with the two or three offers worth your time.