Do i need a lawyer or a bookkeeper?

What is the difference between a lawyer and a bookkeeper? Does a bookkeeper know how to make contracts and general acts? Does a company need a lawyer or a bookkeeper? These are some of the questions we are going to answer in this text.

It has become a practice that companies, often small and medium-sized ones, in Belgrade and other parts of the country, hire a bookkeeper to run their business instead of hiring a lawyer. The bookkeeper is hired to make different contracts, regulations, or to help with founding a company, a branch office or similar. After a certain legal work is done, usually in an unprofessional way, the bigger problem comes up – a legal violation, criminal act, long and expensive law proceedings, or other complications.

Consequently, the same companies then call for lawyers’ help for solving the problem that has occurred.

Having shared experience with many lawyers from Belgrade, I have concluded that these behaviors reoccur customarily.

Why do bookkeepers offer legal services?

The simplest answer is – money. The competition among the bookkeepers in Belgrade is immense. That is why many bookkeepers exert unlicenced practices that they include in the legal package of their services.

These services include writing company’s contracts, employment contracts, an annex of the contract, rulebook, working with Business Registers Agency. It is clear that these services relate to corporate/commercial and employment law.

Legal service – a skill and working according to the pattern?

Most of the bookkeepers interpret the law as patternlike and unvaried. So, when they make a contract or regulations (a tiny segment of what law includes) they do it like a chore. During everyday life, bookkeepers come across different employment contracts, selling agreements, rulebooks, etc. In that way, they superficially understand what parts of the contracts are important and what each of them should include. Additionally, one can find templates on the internet, change only small details, and sell it to a client.

That approach is wrong. Law is not unvaried. Advocacy is not a skill learned from a hobby or on the internet. It is the easiest just to change a draft found on the Internet and have a finished contract. But, these drafts cannot anticipate potential issues and regulate specific and various life situations. That is one of the main tasks a lawyer has – to adapt and formulate clients’ needs to satisfy their business plans.

Why should I hire a lawyer if I already have a bookkeeper?

Companies often ask these questions. The answer is simple: unlike the bookkeepers, lawyers can anticipate what can happen in a legal relation, based on their knowledge and experience. Consequently, they can protect their clients’ interests from the very beginning. The key part of offering legal services is also advising a client if some measures can harm the business itself.

If it was easy to produce a complex selling agreement with a protection clause or add a clause on the prohibition of the competition in the contract, the lawyers would not be necessary.

The lawyers educate themselves in years, finish the bar exam to have these specific skills and knowledge.

Responsibility for damage

There is also one more important difference between a lawyer and a bookkeeper. The lawyer is always responsible for the eventual damage. According to the Legal Profession Law, the lawyers are responsible for the damage they did to their clients. Every lawyer is responsible.

If the client suffers loss or damage, he/she has the right to charge the lawyer for it. On the other hand, if the bookkeeper offers the same service, the client is unprotected since the bookkeeper is not responsible for these cases. As a consequence, all the damage is now on the client’s shoulders.

Does a company need a lawyer or a bookkeeper?

It would be ideal if every company had both bookkeeper and lawyer in their team, that is two experts in different areas of expertise. However, this happens rarely. It is because having two experts represents an additional expense.

The companies hire a bookkeeper because they don’t know how to run books and taxes, make financial reports, and similar. That is why companies hire bookkeepers – especially startups. This is, of course, a logical mindset.

But, when it comes to seeking legal help, the companies do not follow the same logic. In other words, they usually disregard the importance of having an expert – lawyer who will deal with legal problems. In most cases, the companies will turn to their bookkeepers, since they are already paying them. Therefore, from a company’s point of view, it is logical that they arrange with their bookkeeper to deal with legal matters – he could not possibly do it wrong.  At the same time, bookkeepers encourage their employers to do business in this way, as they see it as their benefit.

This can bring many negative consequences – for the company itself, which can have potential problems with legal matters done unprofessionally, and the lawyer which will end up in the situation where it is needed to fix the oversights – sometimes too late.

The practice has shown that the company usually hires a lawyer when the problem occurs. The lawyer’s role is not only to tackle the client’s problem but also to prevent the problem from appearing. Therefore, one has to have in mind that if the lawyer is hired when it is too late, there is a higher risk of a negative outcome for the client.

The lawyer must be involved in every segment of the company from the beginning to prevent problems from occurring. The clients often do not see the benefits of this way of running a business. Namely, there are many positive sides when the lawyer is included from the very beginning. Such as:

1. Preventing the waste of employees’ working time,
2. Preventing the expense of eventual judicial proceedings,
3. All legal relations in the company are legally framed to fulfill client’s needs from the beginning,
4. Client’s business is legal and socially responsible

Why can a lawyer do that, and bookkeeper cannot? Because the lawyer had already finished Law school, internship, bar exam, and does this job on an everyday basis.

The difference between a lawyer and a bookkeeper is like the difference between a doctor and a dentist. No one is going to visit their dentist if they have problems with the heart. Asking the bookkeeper for legal advice is like asking a dentist to help with heart problems. Of course, a dentist can give their opinion but they will lack the expertise that only heart doctor has, so they will fail to give good treatment, advice and finally solve the problem.

The purpose of this text is raising awareness among both companies and bookkeepers about how offering these legal services is unacceptable because:

• The bookkeeper hasn’t got the expertise needed for offering legal help
• The bookkeeper is conducting a felony if these services are charged
• The bookkeeper is not responsible for the damage a client can have

Regulatory perspective

In order to fully comprehend the difference between the capabilities of lawyers and bookkeepers, it is important to understand the regulations.

According to the Constitution of the Republic of Serbia, the lawyers offer legal assistance.

In Article 67 of the Constitution of the Republic of Serbia, it is written that the legal assistance shall be provided by legal professionals, as an independent and autonomous service, and legal assistance offices established in the units of local self-government in accordance with the law.

Legal Profession Act, as the regulation that clearly defines this profession and the work of lawyers in Act 3 describes what offering legal help includes. That is:

1) providing oral and written legal advice and opinions;

2) writing petitions, requests, suggestions, applications, legal remedies, and submissions;

3) drafting contracts, testaments, settlements, statements, general and individual acts, and other documents;

4) representation and defense of individuals and legal entities;

5) mediation for the purpose of concluding a legal transaction or the peaceful settlement of disputes and contentious relationships;

6) providing other legal aid on behalf of national or foreign physical or legal persons, based on which to exercise their rights and protect freedom and other interests.

 

The fact that only lawyers can offer legal help and charge it, is regulated by the Criminal Code od the Republic of Serbia that only lawyers can offer legal assistance: “Whoever without required qualification provides legal services for compensation, shall be punished by fine or imprisonment up to two years”.

So if the bookkeeper charges making the contract, he/she has done a felony that can be legally prosecuted. Bearing in mind the mentioned regulations, it is apparent that the lawmakers have recognized the advocacy as the only service capable of protecting the legal interests of individuals and companies and to receive compensation for it.

Lawyers point of view – conclusion

We, lawyers, also hire bookkeepers to provide services from their area of expertise, but we would not refer to them for assistance in our lines of work. In such cases, we consult our fellow lawyers – experts in a certain area of law. We do this simply because the law is a vast area and each lawyer is focused on two to three connected law branches.

The purpose of this text is not undermining the significance of bookkeepers in running businesses. On the contrary, bookkeepers are a significant factor in each company, but in the area of bookkeeping. On the other hand, lawyers are essential for running a company when there is a need for legal assistance.

On the following link, you can access the list of lawyers – members of BAR Association Belgrade.

Author: Attorney at Law Pavleski Aleksandar

Date: 06.04.2020.