Why Succession Planning is Important in Business

5 Sep 2019 Accounting Services

Whether you own a small or large company, succession planning is important in business for both the person leaving and the company being left. Succession planning is especially important to businesses wherein owners and managers are nearing retirement to ensure the smooth ongoing operation of the company. At Leskun & Son Accounting, we know the importance of succession planning and we have experience helping business owners come up with effective plans that transition their work into the hands of their replacements.

Reasons for Business Succession Planning

If you own a company and intend to allow it to continue operating after you retire, it is important to plan for business succession. Some of the reasons that business succession planning is important include:

Succession Planning Helps Manage Debts and Assets

When the time comes to retire, it is important to ensure that all company debts are allocated and managed properly. Business succession plans can help to provide information on which assets should be used to pay off outstanding debts.

Succession Planning Identifies Company Management

One of the main purposes of business succession planning is to assign company management to a competent and worthy leader. Whether the successor is an employee, family member, or group of individuals, it is important to have a plan in place that specifies who will take over as leader of the company upon an owner or manager’s departure. By choosing the right person, you can ensure that your company continues to run competently and smoothly and that your legacy is defined according to your wishes.

Succession Planning can Minimize Taxation

When the transference of any goods, commodities, or assets takes place, taxes can be expected to be involved. In order to minimize loss during a transition of company ownership, it is vital to seek the counsel of an accountant experienced in business succession planning. With the right succession plan, a business can save quite a bit of money during shifts in ownership and management.

If you would like to learn more about why succession planning is important in business, or if you are interested in one of our services, please contact Leskun & Son Accounting at 1-877-826-1219 or by filling out a contact form on our website. We are proud to offer a wide range of accounting services and business consulting services to businesses throughout Langley, Mission, and Abbotsford.