Inability to quickly obtain accurate financial statements
Any assets are more valuable the easier they are to manage. This also implies the ability to quickly collect financial statements. A common occurrence for not very popular and in-demand companies (the so-called second tier) is 30-45 days to prepare reports.
For Western countries, this is taiwan email list an unacceptably long time. There, such an operation takes from 5 to 10 days. After all, the data is needed for decision-making, and it loses its relevance if you have to wait too long. And why would a potential buyer need a company about which there is no precise financial information (and it is also impossible to get it quickly) for the last couple of months of operation?
Pitfalls of Selling a Business and Ways to Avoid Them
What to do in such a situation? Take care in advance that the reporting is closed as quickly as possible. Such changes at the enterprise can take about a year. About 3-6 months will take a radical change in the accounting scheme, the introduction of an accrual system without the use of supporting documentation. Plus, you will have to master the regulations for quick closing. And then about another six months (and maybe more) will be spent on optimizing the document flow and ensuring that counterparties learn to submit all the necessary documentation for transactions as quickly as possible.
Here's another important thing to remember when selling a business: the financial results of commercial activity are not always accurately reflected in the financial statements. This happens due to various circumstances, such as:
business transactions are recorded only after supporting documents have been received;
RAS specifies one set of depreciation rates, but during the process of using the asset, completely different indicators arise;
there are transactions not reflected in the balance sheet, etc.