Category: Wealth Tips

This is a potentially useful article from my accountant, Tony Cammarata at Prudential Partners.
Would you pay top dollar for a car that doesn’t have registration papers, a service history, keys, an ignition that works or a motor that runs smoothly? We doubt it.
On the flip side, you’d likely pay extra for a car if the owner went to the trouble of cleaning it out and polishing its paintwork on the day of sale.
It’s no different for businesses. Why would anyone pay top dollar for a business that has not been serviced or tidied up before being put on the market?
Before putting your business on the market, you need to put your thinking cap on. If you were a potential purchaser, what would you criticise about your business?
Now you need to do as much as you can to resolve those issues. If you don’t resolve them, don’t be surprised if they come up in negotiations as the basis for a purchaser offering a lower price.
Here’s where we can help! We have a ‘shopping list’ of common mistakes that business owners make when selling a business. This article shares our insights with you so that you don’t fall into the usual traps.
1. Corporate records are incomplete
Having poorly maintained or incomplete corporate/entity records is a classic way to put off purchasers (or their advisors).
We’re talking about things like member’s registers, director/member resolutions and share transfers. Sometimes they are missing, maybe they were never signed. This can make purchasers uneasy, and it demonstrates bad business ‘housekeeping’. It leaves purchasers wondering what else hasn’t been properly documented.
If you operate your business through a trust structure, then pay attention. Incomplete records are a common problem for businesses that involve trusts (especially unit trusts). A trust may hold some of the business assets or be the main operating entity. There is no central register for trusts like the ASIC register for companies, so trusts are only as good as their internal records. If the records are out of date or incomplete, the details of the current trustee or the recorded unit holdings may be altogether wrong.
We suggest that you undertake an audit of the corporate/ entity records for your business early. Certainly before putting your business up for sale. This will give you time to locate and collate documents that already exist and to reconstruct missing documents as appropriate.
2. Missing (or badly drafted) employment contracts
For most businesses, their team represents a great deal of the value. Often a purchaser wouldn’t consider taking on a business without the staff that know how to run it. Yet we see so many vendors –probably more than half – try to sell a business without having any employment contracts in place.
Even when there are contracts, they are often outdated, inadequate or just plain unlawful. There is no faster way to scare off a purchaser than having them think they are inheriting claims for unpaid employment entitlements or underpayment.
We recommend having your employment contracts (or at least those for your key staff) reviewed before putting the business up for sale. Any issues can be fixed up before potential purchasers are on the scene. Post-employment restraint and non-compete provisions could be included where appropriate to give the purchaser more comfort – and get you more money.
3. The lease expired (or worse, no lease)
If you value the location of your business, it is likely purchasers will, too. If your lease isn’t in good shape with plenty of time left on the clock, you likely won’t get top-dollar for your business.
The first thing to do is to make sure you actually have a lease in place. If you have a good relationship with your landlord or have been in the same premises for a long time, you may find that your last lease expired years ago. It’s a common oversight. Generally, the time to negotiate a new lease is before the landlord catches wind that you are thinking about selling, as they may not offer such favourable terms to someone else (i.e. your purchaser).
If you don’t have a lease, now is the time to insist on one. You might have been willing to rely on a handshake, but your purchaser won’t be. Ideally, the lease should be for a relatively short initial term (i.e. 2-3 years), with a few rights to renew for a similar period. This will give your purchaser the most flexibility. And more flexibility for your purchaser means more money for you!
4. Intellectual property ownership
You can’t expect a purchaser to pay big bucks for your business/product name or logo if you don’t own the registered rights to it. You need to make sure all your intellectual property ducks are in a row. This is where registered trademarks come in.
Registering your name or logo as a trademark with IP Australia ensures that you have undisputed ownership rights to that branding. The certainty of ownership equals value to a potential purchaser. And really all you are doing is making the most of what you have already got – you’ve already put the hard work in by developing and promoting the branding.
We’ve seen some awkward situations where the purchaser uncovers that the seller hasn’t actually owned the intellectual property rights it was trying to sell! Either the IP is owned by the individual personally or by a related entity that was not intended to form part of the sale. This can cause all sorts of headaches – and it is worse the closer to the settlement that the ownership issue is identified. We recommend that the entity structure (including relevant asset ownership) be mapped from the outset, preferably via an easy-to-read diagram. Bonus: you can provide the diagram to your purchaser and their advisors during the due diligence period as an easy way to explain your structure.
Think of this process as a ‘tune-up’ for your business. Yes, it will take some planning and effort, but it will pay off by attracting more purchasers that can see immediate value. And that feeds directly into your ultimate goals: Getting the highest purchase price possible and taking a well-earned break!

It’s surprisingly simple, yet accountants suggest not enough business owners do it – often causing undue stress and difficulties down the track for business owners.
https://www.mybusiness.com.au/sales/2572-the-accounting-trick-you-ve-probably-overlooked

Pretty sure I don’t like the idea of a programmer’s bug wiping out my cash deposits…
https://www.theguardian.com/technology/2017/nov/08/cryptocurrency-300m-dollars-stolen-bug-ether?CMP=share_btn_gp

From a newsletter by Scott Bywater.
I’m a big fan of testing and measuring. I don’t like anything that’s wishy-washy.
I like it to be proven, measurable, factual.
That’s one of the things that attracted me to direct response marketing.
And yet, I’m a big believer in the unseen, in intuition.
But only because I do this…
Whenever I get an intuition, I write it down in a book.
It doesn’t whisper.
It’s in the background.
And often, you have to take time out of the beta brainwave and move into the alpha brain wave (i.e. go and grab a coffee, go for a swim, or for a walk in the botanic gardens) for that intuition to kick in.
Anyway, you’re probably skeptical.
But here’s what I suggest you do.
Write down your intuitions in a 3 column sheet.
First column = intuition.
Second column = actioned, yes or no?
Third column = end result.
Do this and I bet you’ll find you’ve been ignoring one of the biggest goldmines accessible to you.
There’s a reason why everyone from Oprah to Donald Trump to Jim Carrey believes in it.
Got an intuition we should have a chat about growing your business?
Then go here:
http://meetme.so/meetwithScottBywater
All for now,
Scott Bywater

(I received this email from a friend and thought it worth sharing. I have met the author and he really DOES know his stuff.)
I talked to a friend today.
Smart Dude, but he hadn’t quite grasped this whole Bail In operation.
It’s important to know what is being planned here. Your bank account could be at risk.
So let me explain it simply.
A strategy has been devised by the Global Financial Mafia (and I use that term advisedly) to protect banks – particularly the large banks – from the financial calamity that is going to result from the explosion of the derivatives bubble.
What is the “Derivatives Bubble?”
Derivatives are essentially bets – yes, like Vegas – bets between financial institutions primarily on the direction of interest rates. One bank thinks rates are going up, the other thinks they are going down and they bet.
The bet becomes a security, like a stock or a bond.
Then people bet on those bets and others bet on the bets of the bets and the bets pyramid to….
Today, there are about $1.2 QUADRILLION dollars in derivatives on the planet. $1,200,000,000,000,000.
About $227 Trillion are held by U.S. banks. $227,000,000,000,000.
The figures are mind numbing.
Banks can use depositors money to help fund their derivatives.
We are talking fiscal insanity.
Warren Buffet has called derivatives, “Financial weapons of mass destruction.”
Sooner or later this bubble will break. Banks who made bad “bets” will suffer catastrophic losses…or will they?
With the new “Bail In Strategy” (designed by the world’s top central bank in Basel, Switzerland) banks that suffer losses and are failing can take money from depositor’s accounts and convert the money to bank stock.
You’re scratching your head now thinking, they can’t possibly take my money….
The trouble is that once you put your money in the bank, IT IS NO LONGER YOUR MONEY. It’s the bank’s money. Yes, they owe it to you. But you are an “accounts payable.” You are what’s called an “unsecured creditor.” And unsecured creditors are paid out from a failing bank after the derivatives holders – the bank itself.
How much they can take is a question, as the FDIC, in issuing a memo on this procedure for U.S. banks, specifically omitted any mention of deposit insurance. Perhaps the insurance will apply, but Bail Ins are new, have never been done here before and the FDIC did not mention insurance in their Bail In memo.
To get the full story of who is behind this and how to protect yourself, read my new book, The Coming Financial Crisis A Look Behind the Wizard’s Curtain. Print or digital.
It is written in “plain english.” Learn what is in progress and how to protect yourself.
Knowledge is power. Get some.
http://www.amazon.com/Coming-Financial-Crisis-Wizards-Curtain/dp/0996968644/ref=sr_1_1?ie=UTF8&qid=1452065397&sr=8-1&keywords=john+truman+wolfe