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Services Analysis Modules

Nine Analysis Modules








To establish in consultation with the business accountant the formula that will enable a future business value to be established without dispute. This formula establishes an enterprise value to earnings before interest, tax, depreciation and amortisation ( EBITDA ). This formula will form part of the succession report, and be actioned by agreement. To establish corporate debt and to determine the appropriate multiple for the business. To establish average trading profits before tax and determine current valuation of the business.





If deemed appropriate – establish separate ownership of IP; using a structure to allow potential for residual income and an immediate tax break. Established business logo, proprietary systems, specific inventions.


Planning (family)

To determine family estate planning needs; to include progeny from earlier relationships (blended families) and family inheritance of assets . To assist to manage assets that are generating non-divisible income (farms, commercial fishing boats) and any off farm/boat assets with respect to the estate equalisation ruling. To consider the structure and currency of Wills and enduring powers of attorney. To ensure the succession of controlling officers of Trust and company's owning family assets are appropriate and in accord with Will planning. To establish options relating to testamentary trust planning for disabled children and for protection of family assets from dilution or divorce. This module typically authorised by individual owners.


Immediate Succession Strategies

A principal reason for business succession planning is the potential for immediate response by a business.. The setting up of clear and certain rules to ensure the viability of the business when a owner wishes to be paid out and/or is required to leave the enterprise without adequate warning. The rules must allow management of the change of equity ownership in such manner that the business and remaining owners will remain solvent in the face of capital payment demands from a exiting owner. The ability to initiate such action if needed. Establishment of a vendor payment schedule (VPS) to make compulsory payment for capital equity. To confer with the business accountant to establish the desired speed of acquisition being compatible with business capacity to service the commitment whilst protecting business viability including allowing growth.


Legal Briefing & Liaison

This module is subject to the report being offered to appropriate solicitors for to be drafted into a business succession agreement. If the client proceeds to the BSA the consultant needs to brief the solicitors; maintain communication between all parties and act as the collector and facilitator for any questions or further information required by the law firm from owners or their advisors. If this follows on immediately from the planning consultant time will be lessened. If the legal work is authorised months or more after the planning quite a bit of time will be needed to remaster the file.


Insurance Funding Management

Business succession planning is about managing the transfer of equity capital as it needs to move and to set up rules as to how. Two triggers are insurable – death and survivable trauma events. Corporate debt is also a strong and important insurable risk. To confer with the financial planner providing the insurance advice. To determine policy ownership is working with the wording of the binding agreement. Establishing the life insured, and calculating minimum sums insured for all business policies. To ensure that clear and certain methods of managing claims including shortfalls and void policies are recorded. Document wording has to be very clear that vendor finance will be the backup. It is often at this point that vague agreements will fail leading to ligation and failure of the business. Business insurance set up without controlling/management agreements in place may completely fail to protect either a business or an estate.



Initial Research


Data offered during the initial client meeting needs to be verified and expanded. To seek full access to the business accountant and any other relevant advisors. To physically collect trust deeds and company registers and schedules involved in the business including the ownership of equity. To ensure that appointment of succeeding structure officers is appropriate to the operating constraints of the business and to determine and examine any other business documentation that will impact on succession planning matters.

This is the first module to be actioned in the succession planning process.


Generation Succession Strategies




Often a plan of 5-10 years to consider medium to long-term succession plans – including identification of internal and external options. This will include setting realistic terms for selected persons to buy equity. This may mean acceptance that family members not succeed to management or board control as opposed to inheriting equity. Depends on timing and capacity .

Accountant meeting usual, maybe families to meet .

Planning in longer term allows careful identification & promotes stability, and training , of the people being considered for succession. This also allows sufficient time for acquisition of equity (either by individual purchase or a business dedicated reserve account) and time to replace the first choice if they prove unsuitable.

Critical to set this up; existing owners may not be able to retrieve full capital value unless this successor is established. No buyer – the business has no value.


Asset & Litigation Protection

To assess the risk of a litigation paper trail leading to personal & family assets that are not trading entities. To assess the level of trading asset protection against litigation. To check that all structures are effective, updated, and compliant with corporate law regulations.

Over time the design and placement of structures within a business develops into control of income streams for taxation purposes. Good tax protection is fundamental, but equally necessary is asset protection and structure succession management.

This may require different or enhanced structures, altering ownership or future trading entities. Consultation occurs with accountants as well as clients and in some cases a tax opinion may be needed.