will work with you to obtain basic financial information needed
to sell most small businesses whcih are profit and loss statements
and balance sheets from the last three years of operation. If you
are three or four months into a new fiscal year, you should also
provide an interim financial statement.
One of the first questions a prospective buyer will ask is who prepared
your financial statements. Even if you have prepared your own financial
statements in the past, you should consider having an outside certified
CPA or Accountanting firm prepare or review them for the sale. This
will increase the value of the business in the eyes of potential
buyers and increase the likelihood of making the sale.
If you decide against using an outside accounting firm to prepare
your financial statements, offer to show copies of your corporate
or, in the case of a sole proprietorship or partnership, personal
tax returns to serious potential buyers. This will help to substantiate
your businesses profitability.
One of the biggest obstacles in selling a business, especially
for the price you want, is finding a buyer who has or can borrow
the cash to buy the business. Hence, it is very common for businesses
to be sold with seller financing. If you do decide to provide financing,
have the buyer sign a loan agreement with you and be sure to get
an attorney to write up the documentation.
The most important document in any transaction is the purchase
agreement. The contract will contain the financial aspects such
as the purchase price, deposits, and the terms of payment of the
balance of the price.
