Books and records: a guide to the employer when selling their businesses

So, I decided it was time to sell your business. You have discussed the sale with lawyers and accountants. You will be interviewed local business broker and educated yourself in the process of selling your company. You choose an experienced business broker that understands your need for confidentiality and given the reasonable valuation analysis (and need to do some soul-searching about the expected price for the business). It is time to go to market. Or is it?

But wait. Let us stop for a moment.

Now is the time to get your business files organized.

How do you present the information might affect your company's sales price of your business! As you must tell your broker, the 'business valuation risk include the size of the consumer. Companies with records are incomplete or do not regularly appear more risky to prospective buyers with their counterparts. Take the time to put the update file and put them in the best light.

Here is a short list of items typically requested by a prospective purchaser at the time of their review:

1) return the last three years of corporate tax and income statement

2) the last three years discretionary income

3) statements Current year-to-date financial statements including profit and loss and balance sheet.

4) The current list of the basic equipment and tools, including the amount of

5) List of existing liens

Account receivable 6) Aging account

7) A list of all outstanding deposits and numbers.

8) List of Employees - including salaries, benefits, years of service and a copy of the employment agreement of each

9) Copy all business insurance policies.

10) Copy of the lease of the building and any addendum.

11) Franchise Agreement

12) Copies of all equipment rental.

13) Copy of license, certification or registration is required for the business.

14) records management such as price lists, sales reports, inventory list, operating manuals, etc.

15) The current list of clients (names of specific clients may be detained until the end of the review)

16) List of major suppliers and distributors

Now is the time to start your preparation, engage your accountant (if necessary) and collect the necessary information for proper evaluation of the prospective buyers. Your organizational skills will pay off when qualified buyers knocking on your door and see how prepared you are. Clean books and records, presented in an organized fashion (invest in a three-ring binder, punch holes and divider!), It will give consumers confidence and pay big dividends to the closing table.