The Importance of Goodwill when Buying a Business
The goodwill of a business, the intangible asset that is also identified as the income and earnings potential of a business, is the most important and most difficult asset to value. In evaluating this intangible asset, you are essentially evaluating the potential of the business and, in many instances, will be relying on subjective assessments. At a minimum, it is critical for a purchaser to collect as much information about the business, participate in the businesses operating activities and review the financial records and information with your business accountant and, if necessary, an accredited business appraiser. At each stage of this valuation process, your business attorney must coordinate with your accountant and/or valuation professional to ensure that you possess the appropriate due diligence opportunities and options in your purchase agreement.
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