Working Capital Management

Sources for use with Extract A Brooke Downs Vennard Partnership (BDVP) BDVP is a firm of solicitors located in British Columbia, Canada. Established in 1980, it has grown into one of the most respected legal businesses in the area. This is important because there are over 10,000 qualified solicitors competing for clients in British Columbia. As well as providing clients with assistance when buying property or making a will, the partners specialise in business, contract and commercial law. Clients are allowed either 30 or 60 days to pay on completion of legal work provided by the partnership. This has helped BDVP increase its client base. However, it can make cash flow more difficult to manage. Communication is very important to BDVP and the partners try to replace computers whenever they become out‑of‑date and slow. They also make sure employees are trained in the use of technology. As well as employing five solicitors, BDVP has a team of other employees in legal occupations such as secretaries, administrative assistants and junior associates. Employees currently work from 8.30 am – 5 pm with a 30 minute lunch‑break. All employees are encouraged to take responsibility for their work and are often consulted about changes affecting the office. The latest example of a consultation was a discussion about changes to employee protection legislation and how it would affect the partnership. Extract B British Columbia Employment Standards Act British Columbia employers can expect significant amendments to the Employment Standards Act to be introduced in 2019. Some of the more significant recommendations for amendment include:  allow alternative working hours within the 40‑hour week to the standard eight‑hours per day  allow employees the right to refuse overtime in circumstances where overtime would conflict with significant family‑related commitments, scheduled educational commitments, or other employment obligations  the existing five days per year unpaid family responsibility leave would be replaced with seven days per year of unpaid leave, which could be taken for reasons of the employee’s own illness or for the care, health, or education of a child in the employee’s care.

Discuss whether this is a suitable way to improve liquidity for BDVP.