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8667.0 - Legal Services, Australia, 2007-08 Quality Declaration 
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 24/06/2009   
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EXPLANATORY NOTES



Scope

ANZSIC93 and ANZSIC06

Coverage

Improvements to coverage

Statistical unit

Comparison with other ABS statistics

Historical comparisons

Reliability of data

Rounding

Reference period

Acknowledgement

Inquiries


INTRODUCTION

1 This publication presents results from a survey of businesses and organisations mainly engaged in providing legal services for the 2007-08 reference year. This is the sixth time the Australian Bureau of Statistics (ABS) has conducted a survey of legal services. Previous statistics were released in respect of 1987-88, 1992-93, 1995-96, 1998-99 and 2001-02 reference periods.


SCOPE

2 The scope of the 2007-08 Legal Services Survey was all employing and significant non-employing businesses classified to of the Australian and New Zealand Standard Industrial Classification 2006 edition (ANZSIC06) class 6931 - Legal Services. These businesses were mainly engaged in providing legal services. Legal services comprises legal representation and advice, the preparation of legal documents and title-searching services (i.e. establishing the legal ownership of a property). Service companies providing occupancy, administrative, secretarial, clerical or similar support services to barristers or solicitor firms were also included. The scope was then further broadened to capture other legal services organisations, such as legal aid commissions, government solicitors, public prosecutors, community legal centres and Aboriginal legal services which may have been classified to other ANZSIC06 classes.

3 For the purposes of this survey, the definition of significant non-employing businesses differed by sub-industry. For barristers, significant non-employing businesses were defined as all non-employing businesses with an estimated annual turnover of at least $50,000 for barristers in New South Wales, Victoria, Queensland, South Australia and Western Australia. No significance cut-offs were applied to barristers in Tasmania, Northern Territory or the Australian Capital Territory.

4 For other legal services, significant non-employing businesses were defined as all non-employing businesses with an estimated annual turnover of at least $50,000. For community legal centres, legal aid commissions, Aboriginal legal services, government solicitors and public prosecutors, no significant cut-offs were applied.
5 Please refer to the Technical Note on historical comparisons for an explanation of changes in the scope between the 2001-02 and 2007-08 surveys.



ANZSIC93 AND ANZSIC06

6 The estimates in this publication are based on ANZSIC06. Data in previous issues were based on the 1993 version of ANZSIC (ANZSIC93). ANZSIC06 was adopted to provide a more contemporary industrial classification system, taking into account issues such as changes in the structure and composition of the economy, changing user demands and compatibility with international classification standards.

7 Title-searching services were out of scope of the 2001-02 Legal Practices Survey. They were included in ANZSIC93 class 7720 - Real Estate Agents at that time. All other private legal services practices were classified to ANZSIC93 class 7841 - Legal Services. This change is considered to have had a negligible effect on the 2007-08 estimates. For further information on the ANZSIC change, see the Technical Note on historical comparisons.

COVERAGE

8 The ABS Business Register provided the population of employing and non-employing businesses/organisations mainly engaged in legal services. Listings obtained throughout survey development were used to identify government solicitors, public prosecutors, Aboriginal legal services, community legal centres and legal aid commission organisations not classified to ANZSIC06 class 6931 - Legal Services.

IMPROVEMENTS TO COVERAGE

9 Data in this publication have been adjusted to allow for lags in processing new businesses/organisations to the ABS Business Register, and the omission of some businesses/organisations from the register. The majority of businesses/organisations affected, and to which the adjustments apply, are small in size.

10 Adjustments have been made to include new businesses/organisations in the estimates in the period when they commenced operations, rather than when they were processed to the ABS Business Register. Adjustments of this type will continue to be applied in future periods.

11 For more information on these adjustments, please refer to the ABS publication Information Paper: Improvements to ABS Economic Statistics, 1997 (cat. no. 1357.0).

STATISTICAL UNIT

12 The statistical units used to represent legal services, and for which statistics are reported, are:
  • The Australian Business Number (ABN) or Type of Activity Unit (TAU) for units selected from the ABS Business Register and
  • The community legal service, government solicitor or public prosecutor organisation, where the organisation was unable to be sourced from the ABS Business Register.

13 In the Legal Services Survey, the statistical unit used to represent businesses, and for which statistics are reported, is the Australian Business Number (ABN) unit, in most cases. The ABN unit is the business/organisation unit which has registered for an ABN, and thus appears on the Australian Taxation Office administered Australian Business Register. This unit is suitable for ABS statistical needs when the business/organisation is simple in structure. For more significant and diverse businesses/organisations where the ABN unit is not suitable for ABS statistical needs, the statistical unit used is the TAU. A TAU is comprised of one or more business/organisation entities, sub-entities or branches of a business/organisation entity within an Enterprise Group that can report production and employment data for similar economic activities. When a minimum set of data items is available, a TAU is created which covers all the operations within an industry subdivision (and the TAU is classified to the relevant subdivision of the Australian and New Zealand Industrial Classification (ANZSIC). Where a business/organisation cannot supply adequate data for each industry, a TAU is formed which contains activity in more than one industry subdivision and the TAU is classified to the predominant ANZSIC subdivision.

14 Further details about the ABS economic statistical units used in this survey, and in other ABS economic surveys (both sample surveys and censuses), can be found in chapter 2 of the Standard Economic Sector Classification of Australia (SESCA) 2002 (cat. no. 1218.0).

COMPARISON WITH OTHER ABS STATISTICS

15 Annual industry data for legal services are published in Australian Industry (cat. no. 8155.0). There are important differences between statistics published in Australian Industry and Legal Services publications and users should exercise caution when making comparisons between the two sets of estimates.

16 Australian Industry presents annual summary statistics at the ANZSIC06 division and subdivision levels. It shows the relative performance of each industry division and subdivision, and allows patterns of change of growth to be analysed across particular segments of the Australian economy.

17 Legal Services supplements Australian Industry statistics with a detailed examination of the structure and performance of legal services businesses/organisations for the reference year of the survey. As such, the survey is not designed to monitor change over time.

HISTORICAL COMPARISONS

18 The reader should bear in mind that this survey was not designed to support accurate estimates of change over time, and as such should exercise caution when comparing the 2007-08 results to the 2001-02 results. Please refer to the Technical Note on historical comparisons for further information.

RELIABILITY OF THE DATA

19 When interpreting the results of a survey it is important to take into account factors that may affect the reliability of estimates. Such factors can be classified as either sampling or non-sampling error.

20 The estimates in this publication are based on information obtained from a randomly selected stratified sample. Consequently, the estimates in this publication are subject to sampling variability, that is, they may differ from the figures that would have been obtained if all units had been included in the survey. One measure of the likely difference is given by the standard error (SE), which indicates the extent to which an estimate might have varied by chance because only a sample of units was included.

21 There are about two chances in three that a sample estimate will differ by less than one SE from the figure that would have been obtained if all legal services businesses/organisations in Australia had been surveyed, and approximately 19 chances in 20 that the difference will be less than two SEs.

22 Sampling variability can also be measured by the relative standard error (RSE), which is obtained by expressing the SE as a percentage of the estimate to which it refers. The RSE is a useful measure in that it provides an immediate indication of the percentage errors likely to have occurred due to the effects of random sampling, and this avoids the need to refer also to the size of the estimate.

RSEs for Table 1.1 Summary of operations, Legal services

Barristers
Other legal services
Legal aid commissions
Community legal centres
Aboriginal legal services
Government solicitors
Public prosecutors
Total
%
%
%
%
%
%
%
%

Businesses/organisations at end June
1.4
1.3
-
-
-
-
-
0.8
Employment at end June
2.6
3.5
-
0.4
-
-
-
2.9
Income
Fee income from the provision of legal and legal support services
3.9
3.5
-
2.1
-
-
-
3.2
Government funding
-
-
-
0.4
-
-
-
-
Other
45.3
24.1
-
3.4
-
-
-
21.6
Total
3.8
3.4
-
0.5
-
-
-
2.9
Expenses
Wages and salaries
12.3
3.8
-
0.4
-
-
-
3.2
Payments for legal and legal support services
10.4
7.9
-
2.5
-
-
-
6.7
Other
5.4
5.1
-
0.5
-
-
-
4.4
Total
4.8
3.8
-
0.4
-
-
-
3.3
Operating profit/surplus before tax
4.7
4.2
. .
. .
. .
. .
. .
. .
Operating profit margin
1.7
2.9
. .
. .
. .
. .
. .
. .
Income per person employed
4.0
2.9
-
0.3
-
-
-
2.5
Industry value added
4.4
3.7
-
0.4
-
-
-
3.2

. . not applicable
- nil or rounded to zero (including null cells)


23 As an example of the above, the estimate of total income for legal services businesses/organisations in 2007-08 was $18,010.6m and the RSE was estimated to be 2.9%, giving a SE of approximately $522.3m. Therefore, there would be two chances in three that, if all units had been included in the survey, a figure in the range of $17,488.3m to $18,532.9m would have been obtained, and 19 chances in 20 (i.e. a confidence interval of 95%) that the figure would have been within the range of $16,966m to $19,055.2m.

24 For barristers and other legal services businesses, the sampling variability for estimates at the state/territory level was generally higher than for Australian level aggregates. Survey estimates for states/territories should therefore be viewed with more caution than the national estimates. Additionally, within states/territories, the sampling variability and therefore RSEs of estimates for smaller states were generally higher than for the larger states. Survey estimates for the smaller states should therefore be viewed with more caution than those for larger states.

25 Estimates that have an estimated relative standard error between 10% and 25% are annotated with the symbol '^'. These estimates should be used with caution as they are subject to sampling variability too high for some purposes. Estimates with an RSE between 25% and 50% are annotated '*', indicating that the estimate should be used with caution as it is subject to sampling variability too high for most practical purposes. Estimates with an RSE greater than 50% are annotated '**' indicating that the sampling variability causes the estimates to be considered too unreliable for general use.

26 Errors other than those due to sampling may occur in any type of collection and are referred to as non-sampling error. For this survey, non-sampling error may result from such things as deficiencies in the register of businesses from which the sample was drawn, non-response, imperfections in reporting and/or errors made in compiling results. The extent to which non-sampling error affects the results of the survey is not precisely quantifiable.

27 Every effort was made to minimise non-sampling error by careful design and testing of the questionnaire, efficient operating procedures and systems and the use of appropriate technology. Survey estimates with a high degree of non-sampling error have been suppressed or provided with relevant cautions.

28 The collection of the number and value of pro bono hours worked is subject to non-sampling error arising from the methods used by legal services businesses in measuring this concept. Many businesses do not keep accurate records of the number and value of pro bono hours worked, estimating this figure instead when reporting to the ABS. For this reason, users are advised to exercise caution when using this estimate.

ROUNDING

29 Where figures have been rounded, discrepancies may occur between the sum of the components and the total. Similar discrepancies may occur between a proportion or ratio, and the ratio of the separate components.

REFERENCE PERIOD

30 Data contained in the tables in this publication relate to legal services operations in Australia during the year ended June 2008. Financial estimates include the activity of any legal services business/organisation that ceased or commenced operations during the year. Counts of businesses/organisations or offices include only those that were operating at 30 June 2008. Employment include only those persons working for a legal services business/organisation during the last pay period ending in June 2008.

ACKNOWLEDGEMENT

31 ABS publications draw extensively on information provided freely by individuals, businesses, governments and other organisations. Their continued cooperation is very much appreciated; without it, the wide range of statistics published by the ABS would not be available. Information received by the ABS is treated in strict confidence as required by the Census and Statistics Act 1905.

INQUIRIES

32 Inquiries about these statistics should be made by telephoning the National Information and Referral Service on 1300 135 070.

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