How does an accountant help you sell your business?
Many owners, especially baby boomers, ask whether their accountant can help with selling or exiting the business. The answer is a resounding yes. Accountants educate owners on their responsibilities, collaborate with other professional advisors, and provide key services to ensure a smooth transition — drawing on financial analysis, tax planning, valuation and estate planning to maximize business value and minimize tax liabilities. Their work spans six areas.
1. Establishing clear business and personal goals — they align realistic, actionable goals with your exit plan and analyze your business and personal financial assumptions
2. Determining business value and price — ongoing valuations, cash-flow projections and tax-minimization advice keep pricing accurate so you retain more value
3. Protecting and growing business value — tax planning, entity structuring, value-enhancement strategies (audits, reviewed statements, benchmarking) and reassessing debt and capital needs
4. Converting business value into cash — for a third-party sale: pre-sale planning at least two years out, tax analysis, prepared statements and reviewed terms; for insider transfers to family or employees: cash-flow modeling, tax analysis and efficient transfer designs
5. Contingency planning — buy-sell agreement valuation formulas and business-continuity planning in the event of the owner's death
6. Wealth preservation and estate planning — estate-plan review, tax-minimization strategies, asset-transfer projections and pre- and post-transition analysis
Key facts: how accountants support a business sale
Accountants educate owners, coordinate the advisory team and provide financial, tax, valuation and estate services
Six areas: goals, valuation and pricing, protecting value, converting value, contingency planning, wealth preservation
Begin tax and financial planning at least two years before a third-party sale
Reviewed or audited statements and entity structuring help maximize value and minimize tax
If this content was useful, the rest of the Selling Your Canadian Business library is one click away. Visit www.sellingyourcanadianbusiness.ca for a monthly newsletter, audio podcast, and video interviews with Canadian advisors. Subscribe now to The Canadian Exit Briefing for exclusive articles, guides and reports written for Canadian business owners and their advisors. Pass this article along to another owner who is working through the same questions.
Disclaimer: This article is for general informational purposes only and does not constitute legal, tax or financial advice. Consult qualified advisors regarding your specific circumstances.
