Checklist to Know Your Current Business Financial Status:
- Financial Statements
This includes the balance sheet, income statement, and cash flow statement for the past few years, providing an overview of the business’s financial performance and position.
- Tax Returns
The business’s tax returns for the past few years can provide insights into its profitability, expenses, and tax obligations.
- Sales and Revenue Records
Detailed records of sales, revenue, and invoices for a specified period can help assess the business’s revenue streams and growth trends.
- Accounts Receivable and PayableA breakdown of outstanding customer payments (accounts receivable) and outstanding payments to suppliers (accounts payable) provides a snapshot of the business’s cash flow and financial obligations.
- Asset Inventory
An inventory list of the business’s tangible assets, such as equipment, machinery, inventory, real estate, and intellectual property, helps assess the value of its physical resources.
- Debt and Loan Documents
Any loans, outstanding debts, or credit agreements should be documented to understand the business’s financial liabilities and obligations.
- Contracts and AgreementsReviewing existing contracts and agreements with customers, suppliers, partners, and employees helps assess the stability and continuity of business operations.
- Organizational Structure and Legal Documents
Articles of incorporation, bylaws, shareholder agreements, partnership agreements, and other legal documents are necessary to understand the business’s structure and ownership.
- Customer and Market Analysis
Market research reports, customer surveys, and industry analysis can provide insights into the business’s market position, customer base, and growth potential.
- Business Plan
The business’s current or most recent business plan can provide strategic insights and growth projections.
- Intellectual Property Documents
Patents, trademarks, copyrights, or any other intellectual property documentation should be included to assess the value of intangible assets.
- Employee Information
Employee contracts, payroll records, and benefits information can help evaluate the workforce’s impact on the business’s operations and expenses. - Insurance Policies
Details of insurance policies, including coverage and claims history, provide insights into risk management practices and potential liabilities.
- Legal and Regulatory Compliance
Documentation related to licenses, permits, regulatory compliance, and any pending or past legal issues is essential for assessing potential risks and compliance matters.
- Industry and Competitor Analysis
Reports and data on the industry, market trends, and competitor analysis can provide context for the business’s performance and competitive advantage.