What Information Does a Finance Broker Need to Assess an Accounting Practice Acquisition?
Updated: Oct 24
A useful Stage 3 finance assessment needs enough information to describe the buyer, target and transaction clearly—but it does not require the final lender credit file to be complete.
A finance broker for accounting practice acquisition work needs more than the asking price and last year's profit.
The Stage 3 information pack should make it possible to understand the buyer, target practice, contribution, security, structure and timing well enough to explore a realistic funding pathway.
Finance broker for accounting practice acquisition: the short answer
Provide the headline transaction: what is being bought, price, settlement expectations and payment structure.
Provide the target practice's historical and recent financial information.
Provide enough client, staff and vendor-role information to understand continuity risk.
Provide the buyer's professional background, financial position, contribution and existing practice information where relevant.
Provide proposed security, timing and any material conditions already being discussed.
Start with a clear transaction summary
The broker should be able to explain what is being acquired, the indicative price, what is included, the proposed settlement date and how much is expected to be paid at settlement.
Provide the target practice financials
Useful Stage 3 information can include historical P&Ls and balance sheets, current YTD accounts and schedules supporting significant normalisation adjustments.
Provide enough client information to understand revenue quality
The broker may need concentration, recurring-versus-one-off revenue, service mix and other client information that helps explain the sustainability of the fee base.
Provide the staff and vendor-role picture
Staff structure, key people, vendor workload and proposed handover can materially affect the post-settlement operating model.
The buyer information matters too
The finance broker should understand the buyer's professional background, ownership experience, proposed role, personal or business financial position and any existing practice that will form part of the combined story.
For an existing firm, recent financial statements and current debt commitments may be relevant.
Contribution and liquidity need to be explicit
State how much cash the buyer can contribute, where it comes from and how much liquidity is expected to remain after settlement.
If property or other assets may be offered as security, identify them at a headline level without assuming a lender has accepted them.
Include the proposed transaction structure
Deferred consideration, vendor finance, retention adjustments, WIP or debtor payments and other settlement mechanics can change how much senior finance is needed and when.
Timing and commitments matter
Tell the broker if an offer, heads of agreement, finance condition, exclusivity period or settlement deadline is already being discussed. The finance pathway needs to fit the transaction timetable rather than be considered separately.
What Stage 3 does not require
The first useful finance assessment does not necessarily require every due-diligence document, final valuation or executed sale agreement.
The purpose is to determine whether the available information is sufficient to form a credible funding view and what needs to be obtained next.
Practical Stage 3 information checklist
Buyer background and current financial position.
Existing practice financials and debt, if applicable.
Target practice financials and current YTD position.
Client concentration and revenue-quality summary.
Staff structure, vendor role and transition plan.
Purchase price, inclusions and proposed payment structure.
Buyer contribution, liquidity and proposed security.
Timing, conditions and major information gaps.
Frequently asked questions
Do I need every lender document before speaking to a broker?
No. Stage 3 is preliminary. The broker needs enough information for a meaningful assessment and can then identify what a particular lender may require next.
Should I wait for the final sale agreement?
Not necessarily. A preliminary funding pathway can often be explored before the final agreement, provided the proposed transaction is described clearly and the assumptions are understood.
What if information is still missing?
List the gaps explicitly. Missing information does not always stop Stage 3, but it may limit how confident or detailed the funding view can be.
Illustrative Stage 3 scenario
A buyer provides the asking price and target P&L but no client concentration data, no current YTD accounts and no explanation of the vendor's role.
The finance broker can begin the conversation, but the funding view may remain provisional until those gaps are addressed. This example is illustrative only.
What should you look at next?
When the funding pathway looks realistic and the buyer understands the main conditions and assumptions, the acquisition can move into Stage 4 with a clearer view of how an offer or heads of agreement should interact with finance.
Next: Stage 4 — Offer / Heads of Agreement.
Conclusion
A strong Stage 3 finance pack is not the final credit submission. It is a structured explanation of the buyer, target and transaction that allows a finance broker to identify realistic pathways, constraints and next information requirements.
Considering an Accounting Practice Acquisition?
Your mortgage broker can help you explore the likely funding pathway before the transaction moves into more detailed negotiations and lender assessment.
General information only. This article does not constitute financial, credit, legal, tax, accounting, compliance or valuation advice. Finance is subject to lender approval, eligibility criteria, terms, fees and conditions. Consider obtaining independent professional advice for your circumstances before acting.
