Business owners in North Carolina and throughout the country may feel as if they are ready to sell their companies. However, it doesn’t mean that the business is ready to be put on the market. One of the most important parts of selling a company is making sure that is accurately represented to buyers. This means ensuring that all records are accurate and organized. Financial records should be put together using accepted accounting methods.
While financial records may not need to be audited, they should be compiled by a professional. Ideally, a business owner will have three years worth of revenue and other information to allow a buyer to properly vet whether it is worth acquiring. Generally speaking, buyers will request that the seller sign documents saying that all other records are accurate. This typically includes operating agreements or any regulatory filings. It may be best to review and update these vital documents prior to selling the company.
Employment records will need to be reviewed and updated before selling a business. Buyers will need to know how each employee is being compensated, what benefits they receive and if they have equity in the company. Finally, companies will want to do a review of their intellectual property and the rights that they have to it before a sale can close.
Generally speaking, business transactions require due diligence on the part of the buyer and the seller. The buyer will need to review records while the seller will ideally review and organize them before listing a company for sale. An attorney may help with this process and otherwise assist with closing the transaction promptly. This might allow a business owner to get maximum value for a business while minimizing exposure to potential future liability.