Am Law 100

HOW WE REPORT FIRM FINANCIALS

The Am Law 100 is reported by ALM publications throughout the United States and around the globe, including The American Lawyer, Law.com, The National Law Journal, the New York Law Journal, the Connecticut Law Tribune, the Daily Business Review (Miami), the Daily Report (Atlanta), The Legal Intelligencer (Philadelphia), the New Jersey Law Journal, The Recorder (San Francisco), Texas Lawyer and Law.com International.

Most law firms provide their financials voluntarily for this report. Some choose not to cooperate, so we make estimates based on our reporting. But all data is investigated by our reporters. If we discover we made an error in reporting a previous years financials, we correct the numbers and base the percentage changes in future years on restated numbers.

DEFINITIONS

GROSS REVENUE is fee income from legal work and revenue from ancillary businesses that generate profits shared by the firms partners.

NET INCOME is total compensation to equity partners.

PROFIT MARGIN is the percentage of gross revenue devoted to net income.

LAWYER COUNTS are average full-time-equivalent (FTE) figures for the calendar year. Temporary and contract attorneys are not included. Retired partners and of counsel are not counted as partners, nor are payments made to them included in net income.

EQUITY PARTNERS are those who receive no more than half their compensation on a fixed-income basis.

NONEQUITY PARTNERS are those who receive more than half their compensation on a fixed-income basis.

LEVERAGE is total lawyers (excluding equity partners) divided by the number of equity partners.

CALCULATED METRICS

COMPENSATION-ALL PARTNERS is net income (total payouts to equity partners) plus the fixed-income compensation paid to nonequity partners. A related metric, Average Compensation-All Partners, is net income plus compensation to nonequity partners, divided by the number of equity and nonequity partners. These metrics provide a snapshot of compensation to the entire partnership, both equity and nonequity.

PROFITABILITY INDEX is profits per partner divided by revenue per lawyer. It demonstrates how efficiently a firm converts revenues into profits.

PROFITS PER LAWYER is net income divided by the total number of lawyers. It reduces the importance of such factors as leverage in assessing firm profitability.

PROFITS PER PARTNER is net income divided by the number of equity partners. This represents the average compensation to equity partners.

REVENUE PER LAWYER is gross revenue divided by the total number of lawyers, measured on an average FTE basis. We have long considered this metric the best measure of a firms overall financial health.

VALUE PER LAWYER is compensationall partners divided by the total number of lawyers. We then divide that figure by $10 million to determine how many lawyers it takes to generate that amount. This metric demonstrates how much each of a firms lawyers contributes to total partner compensation.

COST PER LAWYER is gross revenuenet operating income divided by the total number of lawyers.

OUR CONVENTIONS

On the poster and the A-to-Z chart, full firm names are used. On all other charts we publish shortened firm names.

In 2018, for the FY 2017 financials, we began using a new rounding protocol. We round gross revenue and net income to the nearest $1,000 (rather than $500,000 as in prior years). Profits per partner, revenue per lawyer, value per lawyer, profits per lawyer and average compensationall partners are also rounded to the nearest $1,000 (rather than $5,000 as in prior years). For the purposes of FY 2017 and 2016 year-over-year comparisons, we re-rounded firms FY 2016 financials to the nearest $1,000.

Firms that are tied in the rankings are listed in alphabetical order.

HOW WE DESIGNATE LOCATION

Firms are placed in the international or national categories according to the distribution of their lawyers

INTERNATIONAL FIRMS are those with 40 percent or more of their lawyers outside the United States.

VEREINS are broken out separately on our charts because their organizational structure, particularly regarding profit sharing among offices, differs significantly from other, traditionally structured Am Law 100 firms.

NATIONAL FIRMS are those with no more than 45 percent of their lawyers located in any single region of the U.S.

We recognize regions for this purpose:

New England: Maine, New Hampshire, Vermont, Massachusetts, Connecticut, Rhode Island.

New York City

Mid-Atlantic: Delaware, Maryland, New Jersey, New York State (excluding New York City), Northern Virginia, Pennsylvania

Washington, D.C.

Southeast: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, North and South Carolina, Southern Virginia, Tennessee, West Virginia.

Midwest: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North and South Dakota, Ohio, Wisconsin.

Southwest: Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Oklahoma, Texas, Utah, Wyoming.

West Coast/Pacific Rim: Alaska, California, Hawaii, Oregon, Washington.