1. Buying a Business
in Australia
Conducting Due Diligence
To assess the value of a business and the risks that come with
buying it, check the following documents and information:
a) financial records e.g.
income statements, balance
sheets, tax returns
b) books of accounts
c) product inventory
d) profit and loss records
e) debt arrangements e.g.
loans, letters of credit
f) existing contracts with
employees and contractors
g) purchase agreements
h) lease arrangements
i) registration certificates,
licences, and permits
j) intellectual property e.g.
trade mark, copyright
Documents Needed to Buy a Business
Letter of intent
Also called terms sheet or memorandum of understanding, a
letter of intent means the parties are ready to start
negotiations.
Confidentiality agreement
Signing a confidentiality agreement protects a party's
proprietary information (exposed during due diligence and
negotiations) from falling into the wrong hands.
Sale of business agreement
The sale of business agreement coveres all aspects of the sale.
When used by small businesses, it needs to be accompanied by
a Section 52 statement.
The Costs of Buying a Business
stamp duty
working capital
lease assignment
Financing Options
your personal savings
vendor financing
Don't commit right away to
the first offer or prospect
that comes your way! Let our
commercial lawyers guide
you through the process of
business acquisition. Call us
on 03 9052 3214.
tax obligations
stock take
other adjustments
bank loan
venture capitalists