The purpose of these articles is to educate both buyers and sellers of the many different issues related to a business transfer. The subject matter includes things like the value of a business, the variables involved in a business transaction, financing and structure of a transaction, planning your exit strategy, etc.
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Tuesday, 20 September 2011
Tip for maximizing your business value!
Tip: Don't bury those personal expenses so deep in your corporate tax returns no one can find them-not even bankers or buyers.
Minimizing tax liability is a strategy all business owners think about. But when it comes time to obtain financing or sell the business, buried personal expenses and assests can create a problem in determining the true cash flow. Buyers and bankers won't always give credit to many of these items. As a result, the cash flow can be suspect. And when you apply a multiplier to determine the value on the business, the results can be disappointing . It is in the best interest of a business owner to show a healthy bottom line in the years preceding the sale of their business to get the highest price possible.