Making an exit? Not so fast. Before you even think about selling your business, you should focus some time and attention on your books. Having reliable financial information and realistic forecasts can make or break a deal—and you can only have those things by following these steps:

Bring your accounting process up to speed: If you’ve cobbled together an accounting process based on Quickbooks or worse, the numbers in your head, now’s a good time to update and standardize your process. It may be that things can stay in Quickbooks, but if you have a hard time creating and reading reports, you can be certain potential buyers of your business will have difficulties, too. Use the tips in this recent XMI Insights post to help you understand your options.

Clean up your balance sheet: Cleaning up a balance sheet is not the same thing as altering past numbers to make things look better. Instead, it refers to “changing policies, well in advance of the sale, so that the numbers tell the story of an efficiently managed, profitable enterprise,” explains this Business Owner’s Playbook post. Some areas of focus might be removing non-business assets and reining in expenses.

Hire an expert: Depending on the size of your business, you may not have the budget for in-house positions. Luckily, you can partner with XMI, which offers fractional controller and CFO services. Not only can a controller and/or CFO help you bring your accounting process up to speed, clean up your balance sheet and make sure your company has strong financial controls in place, this expert can also talk the talk. “Being able to effectively articulate your past, current and future financial performance is critical to a successful M&A process,” explains this post on Forbes.

Be prepared for an audit: A formal audit may seem like overkill—not to mention time-consuming and expensive—but oftentimes that’s what a buyer will require. XMI can help you determine the right level of review that is needed to ink the deal.

Don’t hide anything: Is there an issue or discrepancy that you think might turn off a buyer? It’s best to come clean. Because if the buyer is doing her job, she’ll find it eventually. “A due diligence process is compared to a colonoscopy for good reason,” says Josh Farber, vice president and managing director of financial operations at XMI. “It’s thorough.”

Explain any issues quickly yet completely and then move on. “That’s really the biggest thing about getting books ready for M&A—understanding all spikes and variances in your revenue and expenses,” Farber says. “It actually reflects well on the business owner/seller when they have answers to questions about dips and spikes and other irregularities in historical financial information.”

Are you getting ready to make your exit? From accounting to completing the business transaction, XMI can help. Get in touch at 615-248-9255.