18 Jun Around the Web: A Week in Summary
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A recent article from Monitor entitled “AICPA Offers Insight for Valuing Businesses Affected by COVID-19” discusses recently released FAQs from the American Institute of CPAs which are designed to help adjust business valuations based on the CARES Act.
The COVID-19 pandemic and related economic challenges have brought on tax law changes, PPP funding, EIDL funding and the Small Business Debt Relief Program. All of these recent developments bring the potential for one-time events that could alter figures that are inputted when conducting a valuation.
In response to this dilemma, the American Institute of CPAs released a series of FAQs to help valuation professionals navigate these issues when conducting a business valuation.
A recent article from Pet Age entitled “Building Value When Exiting Your Business” discusses what business owners can do to maximize value when they sell their business. The reality is most businesses are not ready to be sold for top dollar. So what actions can business owners take in the present to prepare for a future sale?
Major areas to look for improvement include:
- Accounting & Financial Reporting – Are your historical financial reports ready, accurate, and insightful?
- Personnel – Do you have the right team in place to support a new owner?
- Process & Infrastructure – Do you have a marketing plan, operations manual, employee handbook and business systems to support growth?
A recent blog post from Viking Mergers & Acquisitions entitled “10 Tips When Preparing Your Business For Sale” offers advice to help business owners prepare for an eventual sale. The process of selling a business is complex, however it can be made easier by properly planning for the sale.
10 tips for preparing to sell your business include:
- Hire an outside CPA to complete a profit & loss statement and balance sheet monthly
- Complete your tax returns on time
- Carefully track discretionary expenses
- Discuss tax implications of selling your business with your CPA
- Be committed to selling when you put your business on the market
- Record revenues and expenses in real time
- Maintain your facility and keep up the curb appeal
- Get rid of old and unsellable inventory
- Make sure equipment is working properly
- Hire a business broker to represent you