On a beautiful June day, they shake hands to realize that you are going to work on a mutually beneficial agreement. Without knowing in concrete terms the price and conditions that this “perfect” buyer might be willing to offer, you will provide him with a list of clients and a huge amount of financial data related to your accounting business. You also arrange meetings between the buyer and your main employees, as well as your largest customers. The buyer “drags his feet” for months at the completion of his due diligence while waiting for his offer. They think he`s acting in good faith. The key to a successful transition is to have the right buyer for the practice sold; Otherwise, the 4 current concepts do not matter. Make sure that professional experiences, management styles and customer service philosophies match fairly well. To this end, the seller of a CPA practice should never have a substantial conversation with a potential buyer or provide detailed information about the sale until the parties have entered into a confidentiality agreement. If the seller does not take this advice into account, he is irreversibly exposed to the possibility of abuse with negligible recourse. A seller should rarely enter due diligence before a law is issued and accepted, a seller believes that such a buyer is “perfectly” suited to the seller`s practice. If a buyer is intransigent and reluctant to make a written offer before performing due diligence, the seller should consider suing another potential buyer.
If you are thinking about leaving your business in the near future and want to learn more about how Poe Group Advisors makes it easier to buy and sell a CPA practice, please watch our 25-minute informative video. Do you make a more professional appearance than if you tried to personally manage the sale Before wading too much of the legal practice, be careful to ask yourself what I`m comfortable with? Do I have any doubts or concerns? Is the risk/benefit fair? I don`t have any information? Is that reasonable? Perhaps the most important thing is what I intend to be clearly written in the agreement? The agreement should be prepared by a lawyer and should include, but not limited, the following confidentiality rules: If your retirement plans depend on the successful sale of your accounting practice, you will need a plan. The focus is on improving cash flow and debtors are difficult areas in small audit firms. The time between work and paid work is called “blocking days.” You should try to reduce your locking days when you are trying to sell an accounting practice. 4. What can the seller actually do after closing? If the seller wishes to retain part of the practice or retain certain customers, make sure that the non-competition agreement is specific and clear. If the seller wants to do other types of work that could be considered “public accounting,” it must also be specific and clear. Work closely with a professional If you don`t think you can handle the transaction yourself, talk to a practice broker. They can facilitate the process and will probably improve the result.
And they become: from our experience, the lion`s share of firms is sold between 0.9 and 1.3 times gross costs. Remember that most of Poe Group Advisors` accounting practices are sold at a fixed price at closing. We devote a section to the conditions below, but unfortunately for agreements with conditional conditions, much of the value of the exercise can be lost due to poor transitions and poor service after closure.