(Newswire.net -- January 26, 2015) Reading, Berkshire -- Selling a business is normally the biggest deal of a business owner’s life. So when a business discovered a £1M hole in their balance sheet, during an ongoing business exit, immediate action was needed to firstly clarify and then solve a very big problem.
This is the situation that faced Trevor Wilson and the team at Financial Power when they were asked to look at how they could save this 'business for sale' from an impending disaster.
The two big issues that needed urgent attention were...
1. Establishing the true reason for the system accounting error of stock and eliminating the possibility of fraud.
2. Resolving extended accounting issues as it emerged that these were not exclusive to stock e.g. the bank account had not been reconciled for 2 years
To start with, an interim discovery team comprising finance, IT and business leaders from the affected division was setup to investigate the reasons behind the stock error. The first priority was to eliminate the possibility of fraud.
Financial Power placed one of their accounting systems experts in an interim role to develop a process to reconcile the bank account. For example, two people had been spending a total of 3 weeks every month trying to reconcile the 14 input sources in 5 currencies to the bank account and had still not managed to do this. After a few weeks the prior issues were understood and corrected and an automated process was put in place which took one person two hours each month to maintain.
Not only that, but using a proven exit strategy checklist along with systems and process checking ..
- It was proved no fraud had occurred. Problems of the business and finance systems were understood so a similar event could be avoided going forward.
- The business was given a clean bill of health by the auditors just 2 months after the problem had been discovered
- Reworked figures of how the results should have been were accepted by the potential purchaser and no loss of value of the business occurred
- All areas of business were correctly accounted for at the time of the sale leading to a straight forward completion balance sheet preparation
- Productivity of the finance team increased due to the reorganisation implemented by Financial Power
The end result of Financial Power's engagement was the owner was able to retire knowing that the business would continue successfully and the completed sale was achieved a year later at a multiple of 10 times profit.
Based on this case history Trevor Wilson was nominated by RecommendedExperts.com as a leading professional in his field which was picked up by ABC, NBC, CBS and FOX.
For more info and to get the Exit Strategy Checklist the Financial Power team used in this engagement please visit... http://FinancialPower.biz/exit-strategy-checklist/
For over 20 years, Trevor Wilson has worked with a broad range of companies and has helped owners achieve successful business exits and personal wealth.
About Financial Power
Financial Power specialises in helping business owners and management teams maximise their business exit by reducing timescales and increasing valuation.