Illustrative example · not a client case study
What an exit readiness review can uncover.
A fictional incorporated business owner hopes to sell in three years. This example illustrates questions to investigate; it is not a client case study, valuation, tax conclusion or promise about a sale outcome.
Illustrative situation
Four questions, with evidence behind each one.
- Earnings: The owner describes a strong profit, but the accounts include a one-off expense and owner pay that a replacement manager would not match. Review the records before suggesting an earnings adjustment.
- Records: Revenue is recorded when cash arrives, while work in progress and supplier bills are incomplete. Establish a consistent reporting approach and identify what a buyer would need to reconcile.
- Share qualification: Surplus investments sit in the operating company. Gather the asset history and ownership facts before assessing qualification for the capital gains deduction.
- Owner goals: The owner has a desired sale price but has not allowed for debt, transaction costs, tax or working capital. Build scenarios rather than treating the headline price as spendable proceeds.
Priorities
Turn the gaps into a sequence of work.
In this example, the first tasks would be to establish reliable records, document the owner’s role and collect the corporate and asset history. A tax adviser and lawyer would need to assess any proposed restructuring before it is implemented.
Share qualification can involve ownership and asset-use tests over a 24-month period as well as conditions at sale. That makes an early review useful, but it does not mean every business needs the same timetable or that a late review has no value.
Next step
What the first conversation needs.
Bring a rough timeline, whether you expect a third-party sale or a family transfer, and the question you most need answered. You do not need to know a price already.
The Exit Readiness Review is a written diagnostic. The scope determines what evidence can be reviewed and what further specialist work is needed. An indicative earnings-based view is not a formal business valuation. The published fixed review fee is CAD $7,500.
Next step
Book a call.
Fifteen or twenty minutes, no charge. You describe the situation, David tells you whether he can help and what it would cost.
info@dsjmaccounting.com