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As our country faces the COVID-19 crisis we want to take a moment to bring you up to date on some of the steps Gilmore Jasion Mahler is taking as a result. We would also like to share some information on some resources for businesses, should you need them.

Ohio Governor Mike DeWine has announced a loan program to provide economic assistance to companies due to the slowing down of business in Ohio. It may be available to help your business provide funding for payroll, past due accounts payable and other working capital needs. Typically, such a loan program will have a very low interest rate and up to 30 years repayment schedule. Also, in the unfortunate event that furloughs or layoffs are necessary during these challenging times, impacted employees should qualify for immediate unemployment compensation relief.

Here are some helpful links for businesses seeking information in both Ohio and Michigan.

http://jfs.ohio.gov/ouio/CoronavirusAndUI.stm

https://www.michigan.gov/coronavirus/0,9753,7-406-98178_98179---,00.html

While there has been talk of the IRS possibly moving back the April 15 tax deadline, as of now there is no official word on if that may happen so GJM is currently working under the assumption there is no delay in the tax deadline. We expect to receive further guidance from the US Department of the Treasury this week and will promptly let everyone know.

As we are writing this, our offices remain open, though we have encouraged our staff to work from home if possible for the next three weeks. Should you need to drop off tax documents, GJM offices will be open during our normal business hours for you to do so.

We will continue to monitor COVID-19 developments here in Northwest Ohio and around the nation and share further information with our clients and partners as needed. Please feel free to reach out to your GJM team with any questions or concerns.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting services and provides comprehensive services including assurance, business advisory, tax, risk advisory and healthcare management. The firm's professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.

It’s one of those issues that you may feel you don’t have time for because you’re too busy actually running your business. But it’s an important question you need to ask yourself. What are your plans for the business once you’re out of the picture? It’s surprising how few business owners actually know the answer. Statistics show that almost half of family businesses have absolutely no succession plan.

Gilmore Jasion Mahler and Croghan Colonial Bank recently teamed up to present a business succession planning workshop for area business owners. They offered some valuable takeaways including 8 steps to ensure a successful transition to new leadership.

First and foremost, be realistic about how long it will take to sell your business. Croghan’s Paul Wannemacher says the average time to sell a business once it’s listed for sale on the market is 6-11 months. He says one should also factor in 2-3 months to close once an agreement is reached.

“Make sure you’re ready when that prospective buyer does come along,” says Wannemacher. “Create a descriptive listing of the business as well as an overview. Just like when selling your house, you need to think about “curb appeal”. You may need to resurface the parking lot, freshen the landscape or painting to make it look more attractive to a potential buyer.”

Once you’ve tended to that first impression of your business and informed your key management, here are the 8 steps to succession planning:

1. Get a handle on the marketplace. What’s the climate in your industry, the local economy and the national and international economies? Are there potential buyers out there?  Maybe your family members, managers within the company, maybe competitors?
2. Pull together a team of advisors. This team should include your CPA, lawyer, wealth advisor and commercial banker.
3. Get your business ready for transition

• Review metrics
• Make sure your records are accurate and up to date

It’s smart to anticipate some challenges along the way as you get your business ready for transition. Some of those challenges could include:

• Normalizing your income statement
• Cash flow/debt service history and capacity
• The condition of your balance sheet
• Collateral

Who is in the pool of potential buyers?

4. Get a valuation

Gilmore Jasion Mahler CPA Jeff Denning is an expert in business valuation. He says the first question you need to ask yourself before getting a business valuation is: what are you offering to sell?

“Are you selling all of the transferable assets of your business or a fractional interest or equity share? What about your client and customer relationships? Your contracts? What about your workforce? We’re in the midst of a critical workforce shortage,” says Denning. “Many businesses are interested in acquiring other businesses right now to acquire their workers.”

Another challenge can be landing on an asking price for your business. Denning offers these questions to ask yourself:

• Do you have a CFO or controller to assist in this process?
• Do you have an outside CPA with valuation experience?
• Do you need a business broker to help assess market potential or handle the entire sale process?
• Do you need a real estate appraiser?
• Grade your business against other comparable businesses
• Is the business transferable? Owner-operated? How much risk of retaining customers?
• Put yourself in the buyer’s shoes- your advisors should help with this perspective

5. Create a personal financial plan: What amount of sale proceeds do you need to be satisfied? Look at your living expenses, vacations and spending you anticipate, family and charity goals. Don’t discount the emotional toll of finally leaving a business you’ve nurtured and built over the years.
6. Prepare your family for the transition: The sooner you can let family members in the business know your plans the better. You may consider family wealth transfers through trusts or partnerships.
7. Work with prospective buyers: Some things to keep in mind as you consider bids: how will loyal managers and employees be treated? Will the new owners continue with the company, improve it, or close it down?

“The buyer may want you to stay for a period of time after the sale. Just be very clear what that continuing role might be and how long will it last,” adds Croghan Bank’s Chris Kelly.

8. Structure and close the sale

“Once you’ve identified a buyer, be aware that the final stretch can be as difficult as all the other steps that led you to this… and maybe more frustrating,” says Croghan’s Paul Wannemacher. “Will the business organization change? Will there be a reorganization? Are non-compete agreements needed?”

And, what type of financing is available?

• Seller financing (you take on all the risk)
• Conventional bank financing
• SBA 7(a)
• Collateral enhancement
• Equity investors
• ESOP

From assessing the marketplace to closing the sale, these eight steps are meant to be a guideline as you contemplate the future of the business you’ve worked so hard to build. While it may seem daunting, many financial experts agree that perhaps the worst thing you can do in regard to succession planning is to do nothing. If you and your financial team can come up with a strategy, you can rest assured that your exit will leave your business and your employees well positioned for future success.

Jeffrey S. Denning, CPA ABV, CFF is a partner with Gilmore Jasion Mahler, LTD. He has over 30 years of accounting experience, with a focus on providing services as an accredited business appraiser, forensic accountant, litigation consultant, and expert witness.

Chris Kelly is a Vice President and Commercial Loan Officer at Croghan Colonial Bank. He has over 20 years of experience in commercial banking, providing small to medium sized privately held businesses, nonprofits and professional firms with financial solutions.

Paul Wannemacher, CPA, PFS, CFP is a Vice President and Trust Officer at Croghan Trust & Investment Management. He has over 25 years of experience in trust administration, portfolio management, tax & financial planning and business consulting.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities. 

Dr. Jeremy Cripps brought some welcome news to area manufacturers at a recent Gilmore Jasion Mahler (GJM) Manufacturing & Distribution Financial Executive Roundtable event. That news: he sees no sign of recession now or in the next few years. Economists have been keeping close watch as there had been speculation toward the end of 2019 of a potential recession late in 2019 or perhaps in 2020.

Cripps, an accounting professor at University of Findlay, and avid economy watcher, was the featured speaker at GJM’s roundtable events in both Maumee & Findlay on January 23^rd. He says there are three key factors to consider when looking at the possibility of recession: job growth, consumer confidence and business confidence. He told attendees at both roundtable events that in his opinion none of those indicators suggests recession. He says non-farm job growth is steady, consumer confidence is healthy and he sees no big dip in business confidence.

While easing concerns about recession are welcome, any successful business owner knows they must always be on alert to a potential downturn in the economy and many other potential threats. Gilmore Jasion Mahler CPAs Bob Bobek and Wes Beham say threat of recession or not, there is plenty you can do right now to ensure the health of your business headed into 2020.

“First and foremost,” says GJM Assurance Partner Wes Beham, “Do what you can to improve your balance sheet. Look at your discretionary spending: What can you cut out? For example, dues and subscriptions, travel expenses and other costly commitments can really add up.”

Wes’ other recommendations include the following steps:

• Improve receivable collection efforts with timely and efficient invoicing
• Tightly control investments in new equipment
• Pay down debt

GJM’s Bob Bobek, like Wes, also spends a great deal of time advising clients how to protect their businesses from potential threats. Bobek says regardless of the state of the economy, you should never ignore business growth strategy.

“You need to fight for your market share,” says Bobek. “You need to be prepared for aggressive pricing. And don’t rely on your current customers for more sales. Remember, they’re watching their bottom line as well. Protect those customer relationships but add new customers too. I always say, ‘a business that isn’t growing is shrinking.’”

Bobek and Beham offered attendees other important strategies to safeguard their businesses headed into 2020. They include:

• Reduce raw material and finished good inventory levels
• Evaluate your supply chain
• Evaluate staffing flexibility
• Invest in new technologies with immediate returns
• Reduce Costs
• Engage your banker, continue to manage and grow this relationship
• Develop an acquisition strategy
• Save cash

Gilmore Jasion Mahler offers the Manufacturing & Distribution Financial Executive Roundtable events three times a year at both Maumee and Findlay locations. The gathering is designed for area manufacturing financial executives to come together and share best practices and hear from guest speakers on timely issues that impact their businesses. The next scheduled GJM Manufacturing & Distribution Financial Executive Roundtable event is April 23 and the topic will focus on logistics challenges. Any manufacturing financial executive who would like to attend or sign up to receive future roundtable invitations can email info@gjmltd.com. 

Wes Beham is a partner in the firm’s assurance and consulting area and has over 15 years of experience with Gilmore Jasion Mahler. In his time with the firm, Wes has provided audit advisory and services to a broad range of companies. He leads the firm’s Manufacturing Specialist Team and is a key member of the Construction & Real Estate Specialist Team. Wes has also worked extensively on mergers and acquisitions, and with publicly traded companies as a Sarbanes Oxley auditor and an Internal Auditor for those companies.

Bob Bobek is an assurance partner with over 35 years of public accounting experience who specializes in advising high growth entrepreneurial companies. Bob speaks to groups on topics including; developing key financial ratios and using them to manage your business, understanding and developing contract price estimates, internal control and fraud risks, developing an accounting system for a small organization, treasury management and the fiduciary responsibility of a board.   

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.   

Gilmore Jasion Mahler’s (GJM) benefit Wanderlust: A Night in Casablanca was successful in its goal to help Flag City Honor Flight send more veterans to Washington, DC. The 2019 event, held November 1 at Findlay’s Marathon Center for the Performing Arts, raised over 95-thousand dollars for the nonprofit. Major sponsors included Ohio Logistics, Huntington Bank and American Interiors. Their generosity and that of all sponsors, and those donating at the event, helped to contribute to the final number of $95,263.71. Auctioneer Trent Farthing helped to grow the total by getting the crowd of about 250 caught up in the bidding excitement during the Wanderlust live auction, and the “fill the flight” call for donations.                               

Flag City Honor Flight is a volunteer-run organization funded solely through donations. Its mission is to send veterans to Washington, D.C. to see the memorials built in their honor. In light of the large amount of money raised at Wanderlust and other fundraisers throughout the year, the organization plans to once again offer two flights and two bus trips in 2020. Flight dates are June 9 and September 22. Bus trips are April 24-27 and October 16-19. Flag City Honor Flight serves veterans from not only the Findlay-Hancock County region, but across the state of Ohio and beyond.

Gilmore Jasion Mahler is proud to support the organization by coordinating and hosting the special event. The firm is grateful to all those who have helped to make this year’s event such a success. GJM has hosted three major fundraisers for Flag City Honor Flight since 2016, raising a total to date of $266,667.11.

Some key Wanderlust 2019 sponsors and donors joined Gilmore Jasion Mahler and Flag City Honor Flight for a check presentation December 11, 2019 at the GJM Findlay office.

Pictured left to right:

Nikki Clement, Laurie Zydonik, Marcia Walton, Deb Wickerham, Bob Weinberg, Kevin Gilmore, Mike Brough, Courtney Haas, Steve Schult, Tracy Kennedy, Chuck Stumpp, Susan Ross Wells, Don Bledsoe.

Those unable to attend Wanderlust: A Night in Casablanca who would like to donate to Flag City Honor Flight can do so anytime at www.flagcityhonorflight.org.

Established in 1996, Gilmore Jasion Mahler, LTD is the largest public accounting firm in the region, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting services and provides comprehensive financial services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. GJM’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.

Business financials can get complicated. Overwhelmed by a sea of numbers? A team of Gilmore Jasion Mahler accountants recently walked area businesspeople through the top 5 questions to ask when reviewing your financial statements. They discussed each major section of a financial statement and provided helpful tips on what to look for or ask about. “Chamber U: Understanding Your Financial Statements” was offered in partnership with the Toledo Regional Chamber of Commerce. Gilmore Jasion Mahler presenters included Steve Miller, CPA, Caitlin Bainter, CPA, Michael Brough, CPA.

The five key areas of focus:

1. The Report

• audit
• review
• compilation
• agreed upon procedures

2. The Balance Sheet

3. The Income Statement

4. Statement of Cash Flows

5. Footnotes

Top five takeaways:

• Make sure you know what type of service you are receiving
• Review debt agreements to see what service is required
• Review debt agreements for affirmative and negative covenants
• The statement of Cash Flows gives a clear vision of the health of your business
• Consider whether your basis of accounting is appropriate to meet the needs of your business

Steve Miller, Caitlin Bainter and Michael Brough are part of GJM’s Assurance team, working with businesses across the region to provide trusted guidance.