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Beware of Understating Your Inventory |
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Reporting a lower inventory to their accountant is something many business owners have been doing for a long time. And many accountants just accept the number.
In addition to the obvious concerns, when it comes to selling the business, big problems can arise. How will the inventory be valued in the purchase allocations? And who is going to have to pay the various taxes on the larger amount?
Business owners should give their accountants an accurate inventory value each year, to avoid troubles at the closing table!
© 2009.
Richmark Associates, Inc.
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Realistic Expectation of Business Value |
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Unfortunately, most business owners have a very inflated view of the value of their company. And why not? They have put so much money, time and heart into it.
But they need to realize the price is based on what someone else is willing to pay for it.
Periodically having an evaluation prepared by a professional is a good way to help determine what the business owner needs to do to reach his or her goals.
© 2009.
Richmark Associates, Inc.
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Business Owners Should Be Planning for Their Own Future |
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Business owners are so busy running their companies every day, they never seem to have time to plan for exiting the business. But they can’t avoid planning for this critical time in their lives.
Presenting a business for sale is very different than managing it with the business owner’s personal management style and priorities. It can take years to properly prepare a business for sale to get the highest.
Business owners should start creating an exit strategy at the earliest possible opportunity!
© 2009.
Richmark Associates, Inc.
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Where Are the Business Financials? |
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If business owners do not have all their financials and tax returns at their fingertips (and many don’t), it usually means they don’t refer to them to effectively manage their operations.
It can also mean they don’t understand them. Business owners should regularly review their financials with their accountant and other advisors to do the proper planning necessary for a successful business.
And when it comes time to seek financing or sell the business, these all-important report cards must be immediately available.
© 2009.
Richmark Associates, Inc.
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