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empty road ahead | accountingweb | Business retirement sale is the destination, but planning is a journey

Planning is the journey towards retirement sale


Concluding his series on business sales, Norman Younger highlights the overlooked role of accountants in early and strategic planning, urging collaboration with advisers and emphasising the long-term rewards of investment in the process.

15th Jan 2024
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You might be surprised to learn how many accountants haven’t given a thought to supporting their clients in achieving a successful business retirement sale.

Traditionally their role has been to ensure the accounts are ready to showcase to buyers and to advise on the tax aspects, although often, due to a lack of experience, they overlook legitimate planning opportunities to mitigate one of life’s certainties. Business retirement sale is the destination, but planning is a journey.

Words of warning 

The accountant needs to ensure the client understands how to maximise the value of their business well in advance of parading it in front of prospective buyers. It takes time and effort, lots of it. 

If the accountant lacks the experience themselves, as many do, they need to put their client in front of strategic advisers with whom everybody can work collaboratively.

The low-hanging fruit is well within the grasp of any competent accountant and focusing on this prior to a buyer undertaking due diligence means any potential deal-breaking issues related to the business finances can be addressed and hopefully rectified.

Accountants might well be surprised to discover that they themselves might have missed red flags when preparing the year-end accounts, especially if the bookkeeping is performed by the client in-house and they are simply ensuring compliance is met.

There is nothing worse than not having ready explanations for aberrations or material variations in a trend when a buyer asks about them. Being caught unaware here is the stuff of schoolboy errors.

Of course the earlier the strategic work commences the better, such as margin improvement or debt collection  – that’s why it is a journey.

Key takeaways

Over the course of this series, we’ve explored the hidden cost for clients who keep their accountant in the dark about plans to exit their business and the importance for accountants to understand their role in making the deal happen. If this situation rings true for you, here are four key takeaways to support you through the process.  

  • It is never too early to start planning.
  • Involve your accountant at the outset.
  • Talk to a broker who will work with you and your accountant.
  • Don’t fret over the costs, it’ll reward you many times over.

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