Small Business Management, 18e

Due Diligence for Purchasing a Business

4.4

Examining the Financial Data

• Sign nondisclosure agreement to not reveal confidential information about the business.
• Review financial statements and tax returns for the past five years.
• Recognize that financial data can be misleading.
• Adjust asset valuations to reflect the true state of the business (fair market value).

© 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.