305) BEI Annual Conference – Tom Bayer and Sikich

Tom Bayer and Sikich

Norman: “A little side note, when we hatched this idea of doing The Exit Plan Show, I had to have an initial guest and Tom was it. To start out, Tom, I’m going to have you talk a little bit about what you’re going to present about and I know this is kind of cliché, but they always say a good presenter tells the audience what they’re going to tell them, tells them, and then tells them what they told them. So, we’re going to get a sneak peek. What are you are going to tell them about tomorrow?”

Tom: “So, Norm, BEI has a lot of tools that are available to their members and one of the tools is the tool called ownership transfer tool. So, the ownership transfer tool is really a model that BEI built and we’re transitioning, and as tax laws change and as different things change, that tool needs to be updated. So, we’re in the process of helping them update that tool.

“But that tool really deals with –There are really three questions that I ask a business owner and that’s who’s your successor or who are you going to sell the business to; how much, that’s how much do you need in retirement; and what’s your timeline, the when question. So, this really deals with the how much, right? It really gets into the net after-tax cash flow and it looks at whether or not the structure of the deal is really going to work for buyer and seller.

You’ve done a lot of these types of transactions, worked with a lot of business owners, how do you take your experience from that and how do you use that to improve that tool?”

Tom: “I’ve had a lot of experiences, as you say, and what I look for when I work through that tool with a particular case is I look for — I do what I call a sensitivity analysis. And really, what that boils down to is what has the business historically done from a cash flow perspective and how can we structure the transaction to help the buyer be successful and how sensitive is the cash flow to that and then, of course, the tax is another big piece of that. And as we know, we’ve got all kinds of new taxes. The most recent one that we’re all talking about is the net investment income tax. It’s really a result of the Affordable Care Act that President Obama passed in his first term, so all these taxes and how can we maximize proceeds to the seller, that’s all part of the planning process and, I guess, the big takeaway is its complex. It’s complex, but you have to put it together because ultimately we’re trying to fulfill a businesses’ needs.”

Norman: “So, you focus on exit planning. I know you’ve been a CPA for what, 20 years or so probably?”

Tom: “Twenty-four years.”

Norman: “When did you actually make the move from CPA to really focusing on exit planning and then, how did that connect to BEI?”

Tom: “So, I started in between 2005-2010. I started looking for a process to help our clients with succession planning and really BEI attended the conference that I was at and talked about their process and I was really impressed with what John Brown had to say and how they approached it. So, that was, I think, 2008 or 2009 when I really started to get involved with BEI and I have been following their system since then. So, it’s really a good system. You can’t do exit planning in a vacuum. You really have to look at the big picture; you have to look at what their personal needs are, both buyer and seller; and you have to look at the business from an in-depth perspective.”

Norman: “One thing we didn’t talk about is your firm, Sikich. Can you tell us a little bit more about Sikich? The different services they offer, where they’re located?”

Tom: “So, Sikich has about 11 offices, I mean 12 now. We just had a recent merger in Boston, Massachusetts, but we’re in the mid-west and then we also have technology offices in Houston, Denver and in Boston. But, Sikich has a lot of services available to our clients. The two largest service areas are technology and the CPA and CPA-related services, but we also have investment banking services, we have wealth management and retirement plan solutions, we have HR consulting, we have marketing and PR. We have several service areas available to our clients, so we can deliver some of the solutions that any particular exit planning client might need.”

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