It is a popular misconception that this is for larger companies only. It can be helpful for many small to medium sized companies where the circumstances allow or require.
Typical situations are:
- there are 2 or more separately identifiable trades requiring separate control and measurement
- two or more partners wish to concentrate on a particular aspect of the business
- a disposal of one or more parts of the business is anticipated
- a need for more effective use of tax allowances and reliefs
- disputes between directors or shareholders
- management buyout
- a need to reduce operating costs
- too many companies in the group for size of business.
Although each case will be unique, the likely approach is as follows:
- initial discussions
- assess the present structure and modus operandi
- consider alternatives
- recommendations for change
- agree action plan
- assist with implementation.
There will normally be company law and tax implications. Most of these can be dealt with on the job, but in some cases the services of other professionals (eg a good solicitor) might be recommended.
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