All owners of family businesses will someday exit. Hopefully that exit is by choice, on your timetable. This exit could be a transfer to family members or sale to a third party.

Professional accountants are an indispensable resource when planning your exit. Some small to midsize businesses haven’t had a deep or enduring relationship with an accountant. Other times, your accountant may not be particularly skilled or experienced with everything involved in selling your business.

What should business owners who want to retire look for in an accounting firm? Here are some general principles and important questions to consider as you evaluate this incredibly important relationship. This list incorporates guidance from Upstate Professional CPA Services—a great resource for business owners to contact if you don’t already have this kind of relationship with a trusted firm.

Will your business stay in the family or not?

This is the first and most important question. There are many ramifications here in terms of the difference between ownership and management, limiting tax liability in the transfer, succession planning and change management planning in general, and questions of fairness.

What’s my business worth?

A trusted CPA partner will have a good awareness of the market, a deep understanding of your industry, and complete access to your books. He or she will be able to help set realistic expectations about what your business is worth. Keep in mind that you may not have had to look at your business from the perspective of a buyer, so you may be surprised by what you learn if your business is worth less than you think. It’s much better to figure this out early and plan accordingly.

What will I owe in taxes after a sale (or other transfer of ownership)?

Trusted CPA firms can help limit your tax liability and explore options with you for what to do with the proceeds from the sale.

How can I meet my retirement goals / needs?

It’s important to put your exit in a long term perspective of what you and your family need for retirement. It’s never too late to start retirement planning if you haven’t yet done so! Before selling your business it’s important to understand how this will play out over however many years you can look forward to post-sale.

What will my taxes look like in the years ahead?

It’s likely that your tax situation will change significantly after exiting your business. Careful, advanced planning can help limit surprises and set you and your family up for success.

How much M&A experience does this firm have?

A trusted partner should have years of experience on at least the seller’s side of mergers & acquisitions, ideally for businesses of similar size / valuation to yours, with references if you ask.

In conclusion

These are just some of the key questions that business owners can use to evaluate potential CPA / accounting firm partners to help them prepare for and execute a sale of their business. The right partner is worth the investment!

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