I co-own a biz and am contemplating selling my half to the other partner after being on mat leave.
As part of this, we both discussed getting a valuation from our accountant to look at way forward. So I said I'd speak to her over the phone, which I did, and she discussed various ways of arriving at a valuation and roughly what that would equate to based on how the biz has performed / is expected to perform.
During the discussion, she (accountant) asked me if I had a figure in mind - which I gave her.
Over weekend, I found out (biz partner admitted) that they'd spoke to the accountant a few months back to discuss getting a valuation.
I was quite taken aback...I think the accountant should have told me / mentioned that she had discussed valuations with my box partner a few months back.
It seems wrong to me that accountant should discuss pricing with both 'sides' and not mention it to both in order to be open.
Should add that this accompanies a growing sense of unease about the discussions that have gone on that I have not been aware of whilst I've been on maternity leave.
I think that you probably need to have separate advice and representation. I don't know how big your business is (and therefore how much you might be able to spend on professional advice). but you wouldn't enter a legal transaction with both sides using the same solicitor, so it would seem sensible to get independent financial advice too.
It isn't clear that the accountant has actually done anything wrong as they may have discussed valuation unaware that the intention was for one of you to buy the other out, rather than to sell to a third party.
It must be difficult to go on maternity leave when you own a business. I haven't been there, but getting the right balance of "being kept informed" vs "being on leave" must be tricky.
I would agree. I am an accountant but also have worked in mergers and acquisitions. You both need to get a valuation done independently, compare notes, and agree a price. Apart from anything else, the various valuations are only ever a starting point. What something is worth involves a fair few judgement calls and, critically, forecasts of what will happen in future. What your half of the business is worth is ultimately what she, or someone else, will pay for it.
I am a chartered accountant and worked in corporate finance and mergers and acquisitions. I helped quite a few business owners sell their company.
Get a different accountant, the one you used doesn't seem very capable. Make sure your accountant is qualified, look for ICAEW, ICAS or ICAI (chartered accountants of England/Wales, Scotland or Ireland).
Also ACCA and CIMA accountants are qualified chartered in the UK.
Agree with CharityCase, ultimately the valuation and price will be what someone will pay in the market - future earnings are key if sold as a going concern. Get independent advice from an accountant and use this as a starting point for negotiations.