Page 36 - Bankruptcy Volume 1

 Whether the accountant or financial adviser seeks to apply a retainer in payment of the approved
application

 A summary or cover sheet showing the following:

— Prior compensation requested and awarded

— The name, billing rate, and total hours of each person who billed time arranged chrono-
logically by project category

— A computation of the blended hourly rate for all persons who billed time during the peri-
od

Local Rules

The U.S. Trustee or the local rules may also have provisions affecting fee applications, with which the
accountant or financial adviser should be familiar. For example, the Southern District of New York’s
standing order expands the requirements contained in the guidelines.

Interim Fee Applications

Section 331 of the Bankruptcy Code permits a professional to apply to the court for interim compensa-
tion not more than once every 120 days or more frequently if the court permits. In most cases, the courts
are sensitive to the needs of the professionals.

Interim Payment of Fees and Expenses

In certain cases (generally large cases), the court may allow procedures authorizing monthly payments
of professional fees and expenses. Payments are generally allowed up to a percentage of all fees for the
period, such as 75 to 80% of fees and 100% of expenses. It is important to comply with the procedures
established by the court; failure to do so may result in reductions in amounts awarded.

Common Issues

Common issues that result in the disallowance of fees and expenses include the following:

 Insufficient or vague time detail

 "Lumping" of multiple tasks or activities in a single time entry

 Time entries that do not reflect who did the work, who else was involved, why it was done, and
the result

 Multiple professionals being involved in the same task

fn 6 Supporting detailed descriptions for each individual expense incurred, and receipts available upon request, are generally required.
The U.S. Trustee guidelines describe in general the kinds of reimbursable expenses and provides specific requirements for selected
expenses such as photocopying, facsimile transmissions, mileage, postage, telephone, and courier.

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