Succession Planning is an important process that affects the owner, his or her family, the employees, customers, suppliers, professionals frequently consulted with and the landlord. It can even affect a neighborhood or small town. Succession planning requires a carefully thought out plan, or chaos could result.
Succession planning should be done, even if there are no immediate plans to retire. Life insurance is purchased even though there are no immediate plans to die, and prenuptial agreements are signed even though there are no immediate plans to get divorced. So too, should succession plans be formulated as a precaution against unforseen, unintended and perhaps inevitable future events.
There is a responsibility of the owner to consider the needs of all those involved. Many times the owner is an inner directed person even though they are outgoing when they are with people. They simply may not be aware of the people that would be affected by what is done, or really what is not done properly. The owner’s advisor’s must relate the plan in the terms of the owner's own self-interests. It is in his, or her, best interest that a succession plan be conceived, planned, and implemented.
Note: I am the author of "The Adviser's Guide to Family Business Sucession Planning" published by the AICPA (2006).
To find out how we can help you, call me to discuss a no obligation, no strings attached, paid consultation. Call Ed Mendlowitz at 732 964-9329.
To read an article I wrote for CPAs in the NYS Society of CPAs' newspaper who want to assist their clients in succession planning click the following link. The article contains some informative checklists: http://www.nysscpa.org/printversions/tp/1107/article11.htm
Succession planning for Accountants in their own practice: http://www.nysscpa.org/trustedprof/907/tp4.htm