Articles & News

By Kelly Reiman Earnouts have been used over the years to bridge the gap between the seller’s perceived value of its business and the buyer’s willingness to pay for anticipated future results. Counsel to the parties and their business brokers can be instrumental in setting realistic expectations for them and crafting the provisions to ensure success. The Business; The Parties While an earnout can conceivably be drafted for every business, certain businesses lend themselves better to the achievement of the objective. Those businesses with a recurring stream of revenue are better suited than businesses that have a singular milestone that

By Janna Hoiberg Being an entrepreneur is a challenging occupation. It is filled with opportunities beyond your wildest dreams. Those dreams can also become the nightmare you never wanted. Working with business owners, I find most of the challenge is in the day-to-day operations of the business. That day in/day out, cash flow, hiring, firing, marketing, selling, and servicing customers can be a 24 x 7 job. The challenge is to start running your company and stop having your company run you. If your company runs you, then after a period of time, you burn out. What happens next is

By Graeme Cloutte, CPA The tax implications of buying and selling a business need to be addressed before coming to the closing table to finalize the carefully structured deal that the FBB Group has put together. One of these key implications is how the transaction is structured for purposes of “asset allocation“. In what follows, I am assuming that the deal is a sale of assets, rather than of company stock or LLC membership interests. Asset Sales Compared to Company Stock/Share Sales The vast majority of deals are asset sales rather that sales of shares of a corporation. There are

Written by Stephen J. Furrer, CPA, CEPA, ABV It seems like we’re at a fork in the road: there are some positive signs that the economy is entering the earliest stages of a long term expansion, but at the same time, if we dare read the headlines, it seems we’re destined to repeat 2008. It’s precisely because we’re at this inflection point that we see a lot of business owners thumbing the eject button. If you’ve been thinking of selling your business, here are seven reasons to get out now: 1. You’ve lost the stomach for it A lot of business owners

I was recently talking to a consultant that we have worked with for many years.  During the course of our conversation, I mentioned that we were working on completing a valuation assignment for a business where the son was considering buying the business from his parents.  Depending on the valuation results and other family dynamics, we were either going to assist in structuring a transaction to transfer the business to the son, or take the business to market to sell to a third party.  For internal transfers such as this, we would not only value the business, but would also

Provided by:  Brian Flynn, President Flynn Accounting Resources, Inc. Accident Reports / Claims (settled cases) 7 Years Accounts Payable Ledgers & Schedules 7 Years Accounts Receivable Ledgers & Schedules 7 Years Audit Reports Permanent Bank Reconciliations 2 Years Bank Statements 3 Years Capital Stock & Bond Records Ledgers, Transfer Registers, Stubs showing issues, Record of Interest Coupons, Options, etc.     Permanent Cash Books Permanent Charts of Accounts Permanent Checks (canceled – see exception below) 7 Years Checks (canceled) for important payments (i.e. Taxes, Purchases of Property, Special Contracts, etc.) ***Checks should be filed with the papers pertaining to the

By:  Michael Abramovitz Has your business identified potential tax risks that could affect the valuation of your company? Maintaining good corporate tax ‘hygiene’ is imperative to ensuring that a potential acquirer recognizes that the company has controls in place to ensure that, at a minimum, tax filing requirements have been addressed. That includes filing tax returns on a timely basis, even if the business generated a tax loss. Since penalties are generally assessed on any underpayment, oftentimes loss companies may not bother with extensions.  Even if an extension was filed, the loss company will file their returns late, since no

Contributed by SSA, P.C. After weeks, indeed months, of proposals and counter-proposals, seemingly endless negotiations, and down-to-the-wire drama, Congress has passed legislation to avert the tax side of the so-called “fiscal cliff.” The American Taxpayer Relief Act permanently extends the Bush-era tax cuts for lower and moderate income tax payers, permanently “patches” the alternative minimum tax (AMT), provides for a permanent 40 percent federal estate tax rate, renews many individual, business, and energy tax extenders, and more. In one immediately noticeable effect, the American Taxpayer Relief Act does not extend the 2012 employee-side payroll tax holiday. The American Taxpayer Relief

Contributed by Speed2Results, LLC In a recent presentation on the state of the economy, noted economist, Alan Beaulieu, of ITR Economics, announced a forecast for 2013 and forward.  Beaulieu’s group predicts a strong 2013, a mild recession in 2014, followed by a strong 2015-16.  Mr. Beaulieu recommends business owners who plan to sell or transfer their company in the future, should consider preparing now for a business exit or sale in the next three to five years. Business Value Drivers – Given the current forecast, it is important to take steps now to ensure your business is attractive to potential buyers,