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Rich and Co.

Selling Your TPA/RIA Firm – Brief Pro Forma

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Here is a brief set of questions we use in understanding a firm that is thinking about selling or a transition.  We have a longer spread sheet as well.   For further M&A information contact me directly.

Rich and Co. Preliminary Pro Forma Business Data

Financial Information (please provide, to the extent possible, all information in Excel spread sheet format).

  1. Detailed income statements for fiscal years 2007—2011. Please include the accounting basis, cash or accrual
  2. Detailed year-end balance sheets for each of the years during the above time periods.
  3. For the similar periods please forward any audited, reviewed or compiled information by outside accountants or auditors.
  4. Forecasts/budgets for 2012. If available, projections for 2013.
  5. Non-recurring and add-back expenses for 2010, 2011 and those forecast for 2012, if possible.
  6. Capitalization table and ownership.
  7. List of creditors, amounts due and hypothecation if any.
  8. Capital expenditures, current programs and budgets.
  9. Corporate structure; e.g. corporation (C-Corp, S-Corp), partnership (ltd. or general), LLC, state of incorporation or organization.

Clients and Technology.

  1. Number of plans broken by type, e.g. D/B, 401k etc. (preferably in Excel format).
  2. Sample engagement letter(s) and published fee schedule(s).
  3. Description of technology being used including valuation, database, documents and any other operational software.
  4. Accounting systems, billing systems and time-keeping systems.
  5. If you do daily valuation in-house, then, what system do you use?

Management and Employees.

  1. Organization chart.
  2. Census (on a no-name basis) including compensation, grouped by function, full time equivalent (FTE) and benefits provided (in Excel format).
  3. Employee tenure and turn-over rate (in Excel format).
  4. Management: functions and responsibilities.

Contingencies and Litigation.

  1. List of all pending litigation.
  2. List of any known potential litigation.
  3. List of recent litigation and settlements.
  4. List of all contingencies and commitments.
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Written by Rich and Co.

July 16, 2012 at 2:13 pm

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