While recasting may appear to be an unnecessary effort, in fact recasting your financial statements will typically lead to a clearer, more favourable picture of the value of your business. Recasting will also help identify ways in which the value of your business can be maximised before it is placed on the market. Specifically, since most privately held businesses attempt to maximise expenses to reduce the amount of taxes paid, restating your income statements will probably make your business look more valuable and profitable to a potential buyer.
If you are like most owners of privately owned businesses, you have probably structured your business expenses to include both private and one-off expenditure items. For example, when your financial statements are recast, they will not include personal expenses such as travel, entertainment, private vehicles, or the salaries of relatives etc. that are not directly associated with the running of the business.
Also, by recasting the financial statements, your accountant will eliminate all extraordinary revenues and expenses such as one-off transactions or expenses. These items may have been included in your statements in order to minimise taxes, or they may be related to ventures outside the scope of the core business you are selling.
To correctly calculate one-off or private expenditure items, it is ideal to compare each expense amount over the past two or three years. Buyers or their accountants will most likely question variances in expenses from year to year.
Therefore, the first step in the process is to contact Performance Business Sales to arrange an appointment to discuss what information is required to assess the value of your business and how we will go about marketing your business should you decide to offer us that privilege.
Selling a business is no fluke; it requires considerable expertise and specialisation. We know the market intimately and will provide you with a written assessment of the value of your business in today’s market.
Contact: Performance Business Sales to arrange a meeting for a confidential discussion on the best way to achieve the ultimate outcome for you.