“You can’t look rich to the bank and poor to the IRS at the same time” – Kevin Wrobel
Everybody wants advice on how to pay less taxes. That is good advice; however, if you desire to obtain a loan or sell your business for maximum value, you don’t want your company to look like it loses money every year.
If you are a small business in need of financing, or if you are considering selling it, the time to meet with our CPAs is NOW. Many of these things need to be prepared several years in advance in order to ensure you obtain maximum value for your business.
Sale of a business:
For the sale of a business, it is good to have a profit history for at least a few years in a row. It is also good to show a few years of financial statements prepared by a CPA to ensure they are reliable. Additionally, an investor will want to see a steady stream of positive cash flows.
Just like the sale of a business, banks like to see financial statements prepared by a CPA and will also use the financials to ensure you are able to pay back the loan. For financing, you will also want time to prepare; however, you won’t need the same history you would for the sale of a business.