Vulcan_Rider Posted February 13, 2015 Report Share Posted February 13, 2015 I was offered the opportunity to buy into a business. A friend of mine owns it now and wants to bring me in as a 50/50 partner. As of right now the plan is that we have to agree on what we want in our partnership agreement then his lawyer is going to write up the contract. I am hiring an attorney to review the contract and make sure everything in on the up and up. Before any of that happens though I need someone to look at his financials to make sure that the numbers he told me are accurate and the price I am paying is fair and all that other good stuff. My question is who do I hire to look at the financials of the business? Is that something my attorney will do or do I need to look for an accountant or something of that nature? Any help you can offer is appreciated. Quote Link to comment Share on other sites More sharing options...
Steve Butters Posted February 13, 2015 Report Share Posted February 13, 2015 I would call your attorney and ask him. Probably isn't the first time he's ran into this. Quote Link to comment Share on other sites More sharing options...
Gump Posted February 13, 2015 Report Share Posted February 13, 2015 (edited) Some attorneys can't count. A 3rd party CPA should look at the business financials. A CPA with no conflict of interest. Like Bruner Cox LLP.Does the business have issued shares? Edited February 13, 2015 by Gump Quote Link to comment Share on other sites More sharing options...
Bad324 Posted February 13, 2015 Report Share Posted February 13, 2015 Yup use a CPA for that partWhat kind of business if you don't mind me asking? If you ever need a 3rd partner I'm always listening Quote Link to comment Share on other sites More sharing options...
Vulcan_Rider Posted February 13, 2015 Author Report Share Posted February 13, 2015 (edited) Yup use a CPA for that partWhat kind of business if you don't mind me asking? If you ever need a 3rd partner I'm always listening Its a Bar and pizza place that are connected. Its called the Barking Bullfrog in Strongsville Edited February 13, 2015 by Vulcan_Rider Quote Link to comment Share on other sites More sharing options...
Casper Posted February 13, 2015 Report Share Posted February 13, 2015 Its a Bar and pizza place that are connected. Its called the Barking Bullfrog in StrongsvilleNew OR party pad for after IMS? 1 Quote Link to comment Share on other sites More sharing options...
Connie14 Posted February 13, 2015 Report Share Posted February 13, 2015 Definitely have a 3rd party CPA review. That is a cash intensive business, and they may be able to spot any irregularities. Also, be prepared to potentially lose a friend. Unfortunately, sometimes business deals go bad. Good luck! Quote Link to comment Share on other sites More sharing options...
Bad324 Posted February 13, 2015 Report Share Posted February 13, 2015 Its a Bar and pizza place that are connected. Its called the Barking Bullfrog in StrongsvilleHmm I'll have to check this place out sometime Quote Link to comment Share on other sites More sharing options...
madcat6183 Posted February 13, 2015 Report Share Posted February 13, 2015 Definitely have a 3rd party CPA review. That is a cash intensive business, and they may be able to spot any irregularities. Also, be prepared to potentially lose a friend. Unfortunately, sometimes business deals go bad. Good luck!This, friend has been going through the process himself, except the other 3 current owners(1 selling out his ownership totally), apparently can't decide on how things should be split in the new division. I think in the end my friend will lose 2 good friends and most likely have to fine a new career because of it. It already is getting messy and it just started. Sorry but business with friends IMHO is almost never a good idea unless it's started 100% together and run 100% together with 50/50 interest split up front. 1 Quote Link to comment Share on other sites More sharing options...
bowdog Posted February 13, 2015 Report Share Posted February 13, 2015 Gump and Connie have said everything i was going to say. sounds like you are in the right direction, good luck in future any adventures if you decide that you are going for it! Quote Link to comment Share on other sites More sharing options...
redkow97 Posted February 13, 2015 Report Share Posted February 13, 2015 I used to work for the holding company that owns Sunbelt Business Brokers (http://www.sunbeltnetwork.com/). Business valuation is a large part of what they do when people approach them trying to sell their business. I did not work with that brand (the holding company had 6 other brands), and I have no idea who would be in your area, but this is right up their alley. If you're interested, I do know that their brand manager is now a stay-at-home mom, and a friend of mine. She would have more specific information on the Ohio locations and which owner(s) is/are best at what you're looking for. She may also be qualified to do a comprehensive business valuation herself on the cheap. I know she had completed a ton of certifications that the owners expected her to have before they would take her seriously. PM me if you'd like me to contact her. She may do it as a one-off job at a steep discount. In the alternative, another former Sunbelt corporate employee is now a practicing attorney. He might be able to knock out even more of what you're asking about, but I don't know if he was as involved with the business brokerage side of things. Both Ed and Kelsey are people I would trust with my own money. Quote Link to comment Share on other sites More sharing options...
Gump Posted February 13, 2015 Report Share Posted February 13, 2015 50/50 won't ever work. Maybe an agreement on profit sharing, pay is 50/50 (contingent upon you performing your expected duties) and actual ownership is technically 50/50, but day to day decisions can't be 50/50. You'll kill each other and micro manage each other, crazy headaches, stress. Different levels of management need assigned. You've got to trust your partner to make the right decisions and vice versa. You handle this, they handle that. Stay out of each others way but work towards a common goal. You do need a tie breaker if internally there is not one big cheese. Which could be a board of directors when a decision can't be made. Although a board is for capital decisions (major purchases), appointing officers, et cetera. Better solution is that one of you has the last say for day to day operations if need be or a committee of odd number members, typically employees including you, is formed to be the tie breaker for day to day decisions that you get your panties in a wad about. Being an owner, the board of directors allows you to take the topic to the board if you wish and you can call a board meeting, if you're an officer. Depending on if the owners are working owners changes how the management team should be assembled. Quote Link to comment Share on other sites More sharing options...
Vulcan_Rider Posted February 14, 2015 Author Report Share Posted February 14, 2015 Thank you all for the advice. I talk to my guy that does my taxes who's also a CPA and he recommended me to a lawyer in my area. he said the attorney will point me in the right direction of another CPA who specializes in these sorts of things. So I will be calling the attorney Monday and hopefully getting in there sometime next week. Quote Link to comment Share on other sites More sharing options...
Vulcan_Rider Posted February 14, 2015 Author Report Share Posted February 14, 2015 New OR party pad for after IMS? Of course Quote Link to comment Share on other sites More sharing options...
zx3vfr Posted February 15, 2015 Report Share Posted February 15, 2015 So we should expect to see John Taffer yelling at you in a few months on spike TV? 1 Quote Link to comment Share on other sites More sharing options...
shadyone Posted February 15, 2015 Report Share Posted February 15, 2015 Are you going to be a silent partner or are you going to be helping run the joint. Either way make sure you guys are on the same page as far as personal responsibility and what is expected. Dont all of the sudden walk in there like you now own the place and start pouring drinks for yourself and your friends for the free. Honestly If I was a silent partner I would very rarely go in to spend time there. Way too easy to get complacent in that situation. Quote Link to comment Share on other sites More sharing options...
Vulcan_Rider Posted February 16, 2015 Author Report Share Posted February 16, 2015 I will be the operating partner and he will be the silent partner. I will be collecting an hourly wage as well as 50% of profits. I found a lawyer that I am contacting tomorrow so hopefully this will move quickly. 1 Quote Link to comment Share on other sites More sharing options...
bloodninja420 Posted February 16, 2015 Report Share Posted February 16, 2015 Talking way outside my experience here, but:My first inclination would be to have him forward you his tax transcripts (officially from irs.) If his disbursement from this business doesn't roughly reconcile with whatever business financials he's showing you, that could be a red flag. He's sure as hell not Over-reporting income to IRS... Quote Link to comment Share on other sites More sharing options...
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