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Commonwealth Bank Legal Market Pulse Report Conducted by Beaton Research + Consulting June Quarter 2014
20

COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

Jul 06, 2020

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Page 1: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

3

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Commonwealth Bank Legal Market Pulse ReportConducted by Beaton Research + Consulting June Quarter 2014

Page 2: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

1

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Contents

Confidence improves as revenues begin to grow 2

Economic Update 3

Overall Business Conditions Perception of business conditions for Australian law firms from now to 2 years’ time 4

Perceived performance of Australian economy 4

Perception of business conditions in specific areas 5

Revenue predictionsChanges in revenue over the next 6 months by location 6

Changes in revenue over the next 6 months by practice area 6

Changes in revenue over next 6 months by practice area cont. 7

Realised ratesExpected changes in realised rates over the next 6 and 12 months 8

Expense and profitability predictionsChanges in expenses over the next 6 months 9

Changes in staffing over the next 6 months 10

Change in operating margins over the next 6 months (segmented by tier) 10

Business process efficienciesOutsourcing back office functions in the last 12 months 11

Outsourcing office functions to a lower cost location in the last 12 months 11

Are clients’ putting more pressure for law firms to use LPO? 12

Effect of growth in LPOs on operating margin over the next 12 months 12

Provision of non-legal servicesProvision of non-legal services 13

Non-legal services - percentage of revenue 13

Potential revenue from non-legal services 14

Competition from non-traditional (alternative business model) law firmsCompetition from non-traditional (alternative business model) law firms 15

Frequency of competition from non-traditional (alternative business model) law firms 15

Proportion of firms that would encounter competition from alternative business model firms over the next 12 months 16

Impact of alternative business model firms over the next 12 months 16

Entry of international law firms 17

Are the entry of international law firms about to stop? 17

Impact of Federal Budget on firms 18

Impact of privatisation of AGS on firms’ revenue 18

Page 3: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

2

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Marc Totaro National Manager, Professional Services Commonwealth Bank

Welcome to the final Commonwealth Bank Legal Market Pulse report for the 2014 financial year, conducted by the specialists at Beaton Research + Consulting. This quarter’s report shows the profession ending the year in good shape, despite the ongoing challenges of a highly competitive business environment.

Over the last quarter, confidence has continued to rise among legal firms around Australia, as the non-mining economy gains momentum and business conditions strengthen. While our measure of current conditions is still in negative territory, it continues to improve, rising five

percentage points since the March quarter.

At the same time, longer term expectations have moderated. While a substantial majority of Managing Partners still expect conditions to become positive within two years, that number has edged lower, suggesting that many foresee tough conditions will continue for some time to come.

Nonetheless, there are some encouraging signs. After falling back at the start of 2014, revenue expectations rose in the June quarter across Australia, the UK and Europe, with only Asia edging lower. The Sydney market in particular looks strong, while an upsurge in infrastructure spending and government outsourcing has seen revenue expectations from Canberra-based work improve substantially. Firms now expect revenues to increase in 13 out of 15 practice areas, with Construction, Engineering and Infrastructure practice groups particularly likely to benefit from higher demand. Only Taxation and Banking and Finance have lost ground.

There are also signs that the profession’s focus on efficiency and expense management is beginning to bear fruit, with top-tier firms in particular anticipating an uptick in operating margins over the next six months. Nonetheless, we can expect firms to continue pursuing efficiency measures in the months ahead, in part driven by clients. 2014 has seen growing pressure from clients to contain costs by using legal process outsourcing, especially in the top-tier firms. Meanwhile, the last quarter also saw a jump in the proportion of top-tier firms face growing competition from non-traditional law firms, another sign that the competitive landscape continues to evolve.

I trust you will find this edition of the Commonwealth Bank Legal Market Pulse report informative and useful for your firm’s planning and benchmarking. We look forward to continuing to monitor the legal industry’s sentiment and performance, and sharing these insights with you.

Please contact me if you would like any further information or if you would like to receive further research insights on mid and top-tier firms.

Marc Totaro Email: [email protected] Phone number: +61 2 9303 1940

Confidence improves as revenues begin to grow

Page 4: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

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COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Diana Mousina Associate Director Economics

As we enter the 2015 financial year, Australian policymakers continue to grapple with the task of successfully engineering a transition from mining to non-mining led growth. While that transition is far from over, the non-mining economy has begun to gather momentum. A surge in residential construction and exports has helped to support growth, even as mining investment falls.

As a result, economy-wide growth in calendar 2014 is likely to return to long-term trend levels — a positive outcome for businesses navigating an economy in a state of flux.The latest findings from the Commonwealth Bank Legal Market Pulse Report (conducted by Beaton Research + Consulting) reflect this general improvement across the economy, with business conditions improving for another quarter. Businesses continue to be more positive about the longer-term outlook, reflecting rising economic momentum over the medium-term. Nevertheless, firms report that the process of sales and revenue generation remains tight. While an improvement in economic growth

should help to drive higher demand, the uncertainties of an economy in transition will continue to be felt over the months ahead.

In this quarter’s report, many Australian law firms also indicated that they are looking to increase numbers of partners, senior associates and lawyers. That may still be a challenge in a relatively tight labour market. Employment has held up better than expected in 2014. While employment growth is low, the unemployment rate looks to have peaked at a relatively low level of 6.0% in February. Commonwealth Bank expects employment growth to remain soft and the unemployment rate to trend around 5.8%–5.9% over 2014. That should help to support consumer spending growth, with job security fears falling as the unemployment rate hovers in a tight range.

Overall, the outlook for the new financial year is positive. The Reserve Bank has had a neutral policy bias since February, with the desired growth transition underway and the mining capital expenditure pothole less threatening than previously expected. Despite the recent lift in the Aussie dollar, the currency is well below peak levels and will provide stimulus to growth, although a lower currency will also increase imported inflation. We see inflation moving towards the top end of the Reserve Bank’s target band towards the end of the year. In our view, these factors will see the Reserve Bank starting to normalise monetary policy in November, with a 0.25% interest rate hike.

Economic Update

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4

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Overall Business Conditions

Perception of business conditions for Australian law firms from now to 2 years’ time

Perceptions of business conditions continue on an upward projection, although the short-term outlook remains negative. There is some softening in the long term this wave, which could be related to the Federal budget announcement.

Net %

(po

sitiv

e - n

egat

ive)

-28 -23

9 10

50 45

80

60

40

20

0

20

40

60

80

100

Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14

At the moment Likely to be in 12 months' time Likely to be in 2 years' time

Perceived performance of Australian economy

The majority of firms believe that the economy will perform positively over the next 12 months, this is especially true among top-tier firms. Interestingly, 1 in 4 mid-tier firms expect that the economy will perform negatively over the next 12 months.

Very negative Net % (positive – negative)Negative Neutral Positive Very positive

42 57 38

19 25

39 43 38 19.4

42.9

12.5

100

80

60

40

20

20

40

60

80

100

100

80

60

40

20

0

20

40

60

80

100

Total Top tier Mid tier

% %

Page 6: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

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COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Perception of business conditions in specific areas

Firms are still finding it challenging across most business areas.

Net

% (

posi

tive

- neg

ativ

e)

28 35

-3

3

-16 -19 -16 -23

-47

-32

-66 -61 -63 -65 -69 -68

-88

-74

100

80

60

40

20

0

20

40

60

Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14

Accessing capital Keeping quality staff

Finding quality staff Keeping expenses under control

Collecting invoices Keeping staff fully utilised

Competing with other firms

Winning new business

Negotiating price with clients

Page 7: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

6

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Revenue predictions

Changes in revenue over the next 6 months by location

Revenue expectations have improved this quarter across all locations measured except for Asia.

62

76

38

75 75 71

36 38

10

38

20

35

13

29

-29

-13

40

20

0

20

40

60

80

100

Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14

Sydney UK / Europe Asia Melbourne Canberra Brisbane Perth Adelaide

Net

%

(incr

easi

ng -

decr

easi

ng)

Changes in revenue over the next 6 months by practice area

Forecast in revenue across construction, engineering and major infrastructure and IT, telecoms and media have improved the most across all business areas.

Net

%

(incr

easi

ng -

decr

easi

ng)

64 67

38

63

42

52

36 43

29

43

19

41 35

41

26

39

0

20

40

60

80

100

Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14

Employment, workplace and

OH&S

Construction, engineering and

major infrastructure

M&A and corporate advisory

Insurance Government IT, telecoms and media

Insolvency and restructuring

Litigation and dispute resolution

Page 8: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

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COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Changes in revenue over next 6 months by practice area cont.

Revenue expectations in taxation have decreased significantly this wave.

Net

%

(incr

easi

ng -

decr

easi

ng)

24

33 29 31

15

28 30 25

21 23

52

19

5

13

0

20

40

60

80

100

Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14

Intellectual property Property, environment and planning

Other general commercial work

Banking and finance Competition, consumer law and trade practices

Taxation Energy and resources

Page 9: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

8

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Realised rates

Expected changes in realised rates over the next 6 and 12 months

Firms are expecting realised rates to increase slightly in the next 6 months, and to double that increase in the next 12 months.

0.9 0.7 1.0

1.4

0

5

Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 In the next 6 months (as compared to the last 6 months) In the next 12 months (as compared to the last 6 months)

Mea

n %

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COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Expense and profitability predictions

Changes in expenses over the next 6 months

IT hardware and software and marketing and business development areas continue to have the highest forecasted increase in expense among firms. Firms also expect telecommunications expenses to decrease over the next 6 months.

Net

%

(incr

easi

ng -

decr

easi

ng)

44 39

31 35

0

10

19

10

-9 -3 -3

-6 -3

-26

40

20

0

20

40

60

Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14

IT hardware and software

Marketing and business

development

Occupancy Staff training and development

Professional indemnity insurance

Library and knowledge

management

Telecommunications

Page 11: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

10

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Changes in staffing over the next 6 months

Firms are looking to increase partner numbers and senior associates and lawyers over the next six months, and to decrease junior lawyers and admin staff numbers.

Net %

(in

crea

sing

- de

crea

sing

)

6

23

13

50

28

39 44

39

-16 -10

-3

-32

9 10

40

20

0

20

40

60

Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14

Equity partner numbers

Fixed share / salary partner numbers

Senior Associates / senior lawyers

(4th year+)

Junior lawyer numbers (Graduates – 3rd year)

Shared service staff numbers

Secretarial and admin staff numbers

Paralegals

Change in operating margins over the next 6 months (segmented by tier)

A higher proportion of top-tier firms expect an increase in operating margins compared to mid-tier firms.

Net %

(in

crea

sing

- de

crea

sing

)

0

33

0

67

0

25

0

20

40

60

80

Q3 FY14 Q4 FY14

Your firm's forecast for operating margins for the next 6 months

Total Top-tier Mid-tier

Page 12: COMMONWEAL EA MARKET PSE JNE QARTER 2014 …...Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Q3 FY14 Q4 FY14 Employment,

11

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Business process efficiencies

Outsourcing back office functions in the last 12 months

Almost 1 in 4 firms have outsourced back office functions in the last 12 months.

83

17

57

43

77

23

0 20 40 60 80 100

No

Yes

%

Total

Top-tier

Mid-tier

Outsourcing office functions to a lower cost location in the last 12 months

1 in 5 firms have moved office functions to lower cost locations in the last 12 months, with top-tier firms more likely to do so.

88

12

57

43

81

19

0 20 40 60 80 100

No

Yes

%

Total

Top-tier

Mid-tier

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12

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Are clients’ putting more pressure for law firms to use LPO?

Almost 1 in 2 law firms believe that there is growing pressure from their clients to use LPO. This is more evident among top-tier firms.

48 71

42

32

29

33

19 25

0

20

40

60

80

100

Total Top-tier Mid-tier

%

Disagree/Strongly Disagree

Neutral

Agree/Strongly Agree

Effect of growth in LPOs on operating margin over the next 12 months

Majority of firms do not believe the growth in LPOs will affect their operating margin over the next 12 months.

6 14 4

10 14

8

84 71 88

0

20

40

60

80

100

Total Top-tier Mid-tier

%

None

Decrease

Increase

“Thus far we are not using LPO’s, but we are investigating possibly using LPO’s. But we’ve given no commitment to use at this stage, nor have we predicted any change to margin via use of LPO’s” CEO/Managing Partner of a single state mid-tier firm

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13

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Provision of non-legal service

Provision of non-legal services

Approximately 1 in 2 law firms are now diversifying their offering as they move into non-legal services, this is more prevalent among top-tier firms.

55

45

43

57

58

42

0 20 40 60 80

No

Yes

%

Mid-tier

Top-tier

Total

Non-legal services - percentage of revenue

At present non-legal services only account for 1-2% of revenue.

14 20 7

10 14

50 0

50 50

50

14 20

1.5

1.3

1.7

0

0.5

1

1.5

2

2.5

0

20

40

60

80

100

Total Top-tier Mid-tier

Mea

n %

%

10% or more

7.5%-less than 10%

5%-less than 7.5%

2.5%-less than 5%

1%-less than 2.5%

0.5%-less than 1%

0.25%-less than 0.5%

Less than 0.25%

Mean

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14

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Potential revenue from non-legal services

Firms expect revenue from non-legal services to increase, especially over the next 2 years.

Increase Increase significantly Decrease Decrease significantly Remain the same Net % (increase – decrease)

57 29

43

71 42.9

71.4

100

80

60

40

20

20

40

60

80

100

80

60

40

20

0

20

40

60

80 Likely to be in 12 months' time Likely to be in 2 years' time

% %

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15

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Competition from non-traditional (alternative business model) law firms

Competition from non-traditional (alternative business model) law firms

Top-tier firms encountered greater competition from non-traditional law firms when compared to mid-tier firms.

16

45

39

0

29

71

21

50

29

0 20 40 60 80

Don't know

No

Yes

%

Mid-tier

Top-tier

Total

Frequency of competition from non-traditional (alternative business model) law firms

Advent Balance and Bespoke Law are the main non-traditional firms which compete most frequently with law firms.

45 56 56 63

36 33

44 25

18 11 13

0

20

40

60

80

100

AdventBalance Bespoke Law Plexus Other

%

Somewhat frequently

Rarely

Never / Almost never

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16

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Proportion of firms that would encounter competition from alternative business model firms over the next 12 months

Majority of firms expect 25-30% of firms will encounter competition from alternative business model firms over the next 12 months.

%

77

16 6

0

10

20

30

40

50

60

70

80

90

25-30% 31-35% 36-40%

Impact of alternative business model firms over the next 12 months

The majority of firms do not perceive alternative business model firms to have a great impact on their firm over the next 12 months. That being said, 1 in 3 top-tier firms see alternative business model firms as a threat.

-16 -29

-13

77 71 79

6 8

40

20

0

20

40

60

80

100 Total Top-tier Mid-tier

%

Very negative Negative Neutral Positive Very positive

“These firms will have a market-changing influence over time - but momentum is yet to build. Off-setting that, client sophistication will lead to these new models only applying to select parts of the client’s overall needs. So, short-term impact is minimal but increasing over time” COO / General Manager of a national mid-tier firm

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17

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Entry of international law firms

The majority of firms do not expect the entry of international law firms to have a great effect on their firm. That being said, top-tier firms are more likely to expect a negative impact whereas mid-tier firms see it as an opportunity.

-10 -29

-4

58 57 58

29 14

33 3

4

40

20

0

20

40

60

80

100 Total Top-tier Mid-tier

%

Very negative Negative Neutral Positive Very positive

“Creates competitive tensions and restricts ability of those firms to refer work to each other. The remaining national firms will benefit from those conflicts” COO / General Manager of a national mid-tier firm

Are the entry of international law firms about to stop?

A larger proportion of firms expect international law firms to have a greater presence in the future. This is more evident among top-tier firms.

29 38

26

14

29

45

86

33

0

20

40

60

80

100

Total Top-tier Mid-tier

%

Disagree/Strongly Disagree

Neutral

Agree/Strongly Agree

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18

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

Impact of Federal Budget on firms

The majority of firms do not expect the Federal Budget to have a tangible impact on their firm. Mid-tier firms are less satisfied with the budget when compared to top-tier firms.

-26 -14

-29

55 57 54

19 29

17

40

20

0

20

40

60

80

100 Total Top-tier Mid-tier

%

Very negative Negative Neutral Positive Very positive

Impact of privatisation of AGS on firms’ revenue

The majority of firms indicate that the privatisation of AGS will have a positive impact on their revenue.

52

10

71 46

13

39 29

42

0

20

40

60

80

100

Total Top-tier Mid-tier

%

None

Decrease

Increase

Don’t know

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19

COMMONWEALTH BANK LEGAL MARKET PULSE – JUNE QUARTER 2014

For further information

For further insights or information, please contact:

Marc Totaro, National Manager Professional Services

Mobile: 0477 739 315 Direct dial: +61 2 9303 1940 Email: [email protected] Web: commbank.com.au/legalmarketpulse

For media inquiries, please contact:

Kate Powditch, Public Relations Advisor

Direct dial: +61 2 93031353 Email: [email protected]

Things to know before you Can: This report has been prepared by Beaton Research + Consulting and is commissioned by Commonwealth Bank. The confidential on-line survey used to prepare this report was undertaken by Beaton Research + Consulting in May to June 2014. The report is based on the views of 31 law firms across Australia. The report compares results from surveys undertaken in May/June 2014 (Quarter 4) to surveys in February 2014 (Quarter 3). Additional market and industry information has been provided by the Commonwealth Bank’s Economics team. This report may be referred to or copied into internal presentations and reports but not published in any communication that will be distributed or accessed externally. When the material is referred to or used, we would welcome due accreditation to the Commonwealth Bank and to Beaton Research + Consulting.

This report is published solely for information purposes. As this report has been prepared without considering your objectives, financial situation or needs, you should before acting on the information in this report, consider its appropriateness to your circumstances and if necessary seek the appropriate professional advice. The information in this report is based on the views of large and mid-sized law firms across Australia and any opinions, conclusions or recommendations are reasonably held or made, based on the information available at the time of its compilation, but no representation or warranty, either expressed or implied, is made or provided as to the accuracy, reliability or completeness of any statement made in this report. Commonwealth Bank of Australia ABN 48 123 123 124.