Entrepreneurs need their own team to navigate the sales process.
posted by: Brian Caldwell
Jul 11, 2016 8:47:00 AM
Most of the businesses are managed in such a way that the taxable income is minimized as much as possible. However, when you are selling your business, you must make sure that you have normalized all the financial documents so that it will be possible to value the business as per the current market value. Some of the documents that may need to be adjusted a bit are accounts receivable, inventory, prepaid expenses, cash and any cash equivalents too, books of value assets, a careful review of the intangible assets and the accounts payable.
You may also be required to adjust the cost of goods, the salary of the owner to match that of the current market rate, review at the salaries of the family members who are in the business, the rent that you pay for the premises the business is located, revise any other expenses that are carried out by the owner only, and other one-time expenses that are only known to the owner of the business.
There are numerous benefits that you will enjoy by normalizing or recasting the financials of your business prior to selling it. These are:
For you to get the best out of the deal there are some tips that you should follow as discussed above:
First of all the documents have to be available. Secondly, they have to be adjusted to show the real state of the business. It is with the availability of these documents that the process will go on smoothly and also the business will be sold off fast and for what it is really worth.