Selling a Business? How to Prep Your Business Financials
Are you planning to exit in the near future? The best way to start is to get your financials in order. When a buyer evaluates the sale of your business, you must have accurate and detailed financials at the ready. Not only do accurate financials help your business run more effectively, but they also give the buyer insight into how well your business is functioning. Here are a few tips to help your business more attractive to potential buyers, and how an exit strategy can help you.
LET’S START WITH HOW TO PREP YOUR FINANCIALS FOR THE SALE OF YOUR BUSINESS.
Start by getting familiar with your most important financial statements. You need to know and understand your income statement, balance sheet, and your cash flow statement in and out. All of these statements provide insight into how well your business is functioning day-to-day. The financial health of your business is likely already top of mind, but you must ensure you are creating accurate and detailed financial statements in order to understand exactly how well your company is doing.
It’s not a bad thing to ask for help. Hiring a team to help your current accounting team produce these detailed financial statements can be extremely beneficial.
At Turning Point, we implement our proprietary strategies and processes to provide excellent financial reporting.
WHY SHOULD YOU BEGIN PLANNING FOR EXIT?
Your business and your family will benefit from an exit plan. Exit strategies ensure your spouse and dependents are free from unnecessary decision-making and tax burdens that come with owning a company. Start to handle these things well in advance of a major life event.
A strategic exit can help you retire comfortably. Consider your financial goals before you decide to sell, to ensure that selling your business is in line with your personal financial goals.
Be sure to plan for the transition team of your company. Your Board of Directors and employees work hard to help you achieve your goals. When you plan ahead thoughtfully, you can create certainty and stability during the transition.
Ensure you are maximizing your value and growth potential by implementing tangible steps to ensure your financials are sound, which will improve your exit outcomes.
For more insight, reach out to our team.
