Highlights of Canada Day at the IBBA Conference – November 2016 – Phoenix

On November 10th, IBBA Canada hosted its second Canada Day Event during the Fall 2016 IBBA conference.  This full-day event was held in Phoenix Arizona and expanded upon the half-day event hosted the previous November in Albuquerque New Mexico.

The purpose of this day was to make available Canadian-focused content educational sessions.  For Canadian members attending the IBBA conference, there was no additional charge for this full-day of educational content.

The format of the IBBA conference had changed to a 3-day event running Friday November 11 to Sunday November 13, and Canada Day was held on the day preceding the full conference.  This helped members avoid conflicts with attending any other IBBA or M&A Source sessions or courses.

The morning started with a breakfast, followed by a tax course geared towards Canadian tax laws (IBBA course # 580C). The course had previously been prepared for IBBA Canada by Paul Morris, CPA, CA and was updated in the summer of 2016 to reflect changes in tax laws since the first writing.   Although originally prepared to be presented as an 8-hour course, Paul edited the delivery to allow for the 4 hour time slot.

Every Canadian business broker should consider taking this course, as it provides brokers with a higher level set of tools and knowledge of the basic tax rules and calculations to better serve their clients.  The goal was not to make brokers tax experts but to make them aware of the issues that must be taken into account when deals are completed.  Paul Morris is an exceptional instructor.  He delivered “dry subject tax material” with a lot of humour and enthusiasm and all attendees thoroughly enjoyed the course and passed the test at the end.

After lunch and a break, the afternoon was reserved for 4 Mastermind sessions; again all dedicated to Canadian laws and practices.  The following Mastermind topics were discussed:

So We Want to Do the Deal as a Sale of Shares:
We understand the “technical issues”, now what about the pitfalls, when to avoid it, what objections will people raise, and how to overcome buyer/buyer’s professionals objections?

Working Capital – Managing It & Getting Paid to Sell It
With proper planning, a seller can improve his or her proceeds by managing the balance sheet in advance of going to market.  Understanding “value” allows us to help future sellers.  We also must ensure that we ALL understand the basis of our success fee.

Purifying the Balance Sheet
Purification might be needed for taxation reasons.  Purification might be needed to remove redundant assets or liabilities.  Purification might be desirable to maximize payment on working capital.

Employees – Terminate Them?
We all tend to say that the employees are the most important assets a business has.  Then, the advisors for the buyer all say “fire and re-hire”.  How do we get around this reality of brokerage?

Paul Morris attended the afternoon sessions and was very helpful in answering questions and suggesting ways and methods for closing deals, with an eye on successful deal structure that would maximize a seller’s after-tax cash so that both buyer and seller benefit.

The 4 sessions ran at a good pace with a lot of participation from most of the attendees.  The sessions flowed into one another seamlessly as the conversation segued from one topic to the other without any introduction, and without a moderator guiding the discussions.  It seemed that all attendees were in-tune and knew the issues.  In a quick verbal survey at the end of the day, everyone seemed to agree that the day was a great success and that we should continue making the effort to deliver such Canadian content at future conferences.

The day ended with a cocktail hour, followed by joining the IBBA International and New Member reception.

The venue was very nice; weather was great; lunch and cocktail/reception food was good.  From all feedback, everyone enjoyed the experience and IBBA Canada looks forward to the next opportunity to add value to Canadian members.