Key considerations when purchasing an accountancy practice
Whether you’re an experienced buyer, or at the advent of your first acquisition, the process of buying an accountancy practice can be an immensely complex and stressful event without the correct advice and guidance.
With a process as life altering as overtaking the ownership of a business, with substantial professional and personal ramifications, it is important to remain fully abreast at every stage of the acquisition.
At Kings Professional, we are highly regarded within the industry for getting sales across the line in a prompt timeframe.
By advising both the buyer and seller throughout the business sales process, we can remove any unnecessary delays that would otherwise risk a sale falling through, allowing us to facilitate a succinct completion.
Requirements
The primary stage of every acquisition is the process of identifying a suitable target. Before commencing your search, you will want to outline a clear list of your business requirements and the reasons why you are seeking an acquisition; this information is vital for a business broker to correctly match yourself up with an array of appropriate opportunities.
What geographical area are you looking in, and if you already own a practice, within what proximity must a subsequent practice lie? What services are you looking to offer your clients and does your target already specialise in this provision?
How much additional scope for growth must a practice possess, or is it already operating at full capacity?
Preparation
Once you have identified an accountancy practice that matches your search requirements, you will need to draft a formal offer for the business. Within this, you will need to decide on a deal structure that pertains to matters such as staff retention, client retention and trading premises. An accountancy practice owner will have already stipulated their preference on the structure of the deal, opting for a full practice sale or a block of fees, but many are open for negotiations that explore further options.
Due Diligence
Finally, once a deal has been agreed upon by yourself and the seller, the due diligence process will commence; we highly recommend seeking legal assistance from a solicitor with specialities in the acquisition and disposal of accountancy practices.
Due diligence is your opportunity to verify that the promised performance of your target will be realised after the point of transaction. Throughout this stage, yourself and your legal representative will want to review and scrutinise the practice’s financial statements, contracts, certificates, client lists including historical and forecast client retention figures, outstanding fees, asset lists and lease agreements, in addition to any further relevant documentation.
Business sales aren’t packaged with a return policy, so it is vital that you fully comprehend what you are buying in advance of completion.If you are now considering the acquisition of an accountancy practice or would like to seek further guidance regarding your business requirements, please do not hesitate to get in contact with a member of the experienced Kings Professional team and they will be delighted to assist you.
