What Should You Do if Settlement Is Delayed in an Accounting Practice Acquisition?
Updated: 1 day ago
If settlement is delayed, establish the cause, contact your solicitor promptly and ask your acquisition finance adviser to confirm the current funding position before committing to a revised plan.
When settlement is delayed in an Australian accounting practice acquisition, the disappointment is understandable. You may have cleared your diary, briefed staff and planned the first client introductions. A date change reaches much further than the calendar.
The useful response is to bring the facts together while advisers address their responsibilities.
A missing document, a funding requirement and a change in the practice are different problems. They need different owners, and sometimes different decisions about whether the original plan still works.
If settlement is delayed: the short answer
Identify the exact obstacle, the person responsible and the evidence needed to resolve it.
Contact your solicitor promptly about the contractual date, notices and any proposed extension.
Ask your acquisition finance adviser which lender requirements have been accepted and what remains outstanding.
Recheck cash, insurance, premises, vendor support and the operating timetable.
Confirm that the current price, buying entity, money required and proposed date still align.
What is actually holding up completion?
Start with a specific explanation.
‘The lender is still looking at it’ may mean an unanswered question, an unsigned document or a requirement awaiting review. ‘The lease is nearly ready’ may mean that landlord consent has not arrived. Ask what is missing and who must accept it.
Use a short shared update recording the obstacle, owner, next action and next reporting point. Include dependencies: the solicitor may need a lease document before preparing final completion figures, for example.
Someone sending a document does not establish that the receiving party has accepted it. Keep the current contractual date separate from a proposed replacement.
Ask whether the delay is administrative or reflects a changed transaction.
A corrected signature page is different from a vendor seeking a higher price. The information a vendor should provide remains relevant when circumstances change: obtain clear current information rather than relying on the position discussed weeks earlier.
Why should your solicitor be involved promptly?
The contractual position needs legal attention as soon as the date becomes uncertain. business.gov.au’s guidance on selling a business describes the sale agreement as legally binding and identifies payment, handover and conditions among its terms. Your solicitor must apply your actual contract and the relevant law to the delay.
Ask whether an extension is needed, how it should be documented, whether notices require a response and what costs or other consequences may arise.
Do not assume an informal conversation changes the contract, that a grace period applies or that either party can terminate automatically. There is no universal response deadline for every practice purchase.
Have your solicitor advise before agreeing to revised legal terms or taking legal action.
Pressure to ‘just confirm the new date’ can obscure changes to payment or possession. The discussion of commitments before signing or paying is useful here too: a seemingly practical response may create a commitment that deserves advice first.
What should your acquisition finance adviser clarify about finance?
Ask your acquisition finance adviser, within the agreed engagement, for the current lender position.
Which requirements have been accepted? Which remain outstanding? Does the proposed revised date require further confirmation? An earlier approval, submitted paperwork or a verbal expectation should not be treated as confirmation that funds can be released on the new date.
Tell your acquisition finance adviser about proposed changes to the price, purchasing entity, buyer contribution or transaction structure. Ask whether updated financial information or documents are required and have any lender response recorded clearly. The broader accounting practice acquisition finance process explains why funding must be considered alongside the transaction.
A date change should prompt a current check, rather than an assumption that every earlier arrangement carries forward.
How does a new date change your cash and operating plan?
Rework your cash forecast around the proposed date. business.gov.au’s cash flow statement guidance explains how forecasts help plan future finances and payments. For this purchase, check when your contribution and costs fall due, whether extra advisory or premises costs arise and how much cash remains for operations after completion.
Recheck billing and collection assumptions. Moving completion across a billing cycle may change the receipts you expected in the first weeks. Ask your accountant and solicitor how the agreed treatment of debtors and work in progress interacts with the revised date.
You should reconcile the current settlement calculation with the lender-funded amount and your available contribution, because the purchase price alone does not represent the complete cash requirement.
Ask your insurance adviser to confirm cover for the revised start and any interim arrangements. The Tax Practitioners Board’s professional indemnity insurance guidance requires registered tax practitioners to maintain cover meeting its requirements. Confirm the relevant entity, covered activities and dates rather than assuming the vendor’s policy or your planned commencement automatically covers the changed circumstances.
Check premises access, lease commencement, rent, guarantees and any landlord approvals against the new timetable. The premises and lease due diligence questions for accounting practices provide a useful starting point.
Also move software migration, supplier changes and client communication dates where needed. Do not treat a planned operational start as authority to take control before legal completion.
What if the practice changes while you wait?
Ask the vendor for material developments: a major client leaving, a key employee resigning, a changed workload or reduced availability for handover. Establish who continues servicing clients and meeting deadlines during the delay. These developments may affect both the commercial assessment and the information advisers need.
Vendor support deserves a fresh conversation if the new date collides with holidays or another commitment. Revisit the agreed vendor handover structure and have any changes addressed through the appropriate documentation.
Staff communications also need coordination: Fair Work Ombudsman guidance explains that a change of business ownership can affect employee entitlements. Seek advice on changed employment arrangements rather than simply moving every start date.
An illustrative delay and revised plan
Suppose completion is planned for Friday, but the required landlord document remains outstanding. Assume the buyer’s contribution is available and the finance team still needs to confirm funding arrangements for any later date. This is a hypothetical example, not a standard timetable or assurance that an extension will be agreed.
The solicitor advises on the contract and handles the proposed extension. Your acquisition finance adviser obtains the current finance position. The vendor confirms continued client servicing and revised handover availability, while the buyer checks cash and insurance dates.
A proposed Monday date remains a proposal until the necessary legal arrangements and funding position are confirmed. Different contracts and lender requirements can produce different outcomes.
Frequently asked questions
Should I contact my solicitor before the settlement date passes?
Yes. Contact them promptly when completion becomes uncertain so they can advise on your contract, required notices and any proposed extension. Do not wait for a universal grace period.
Does the vendor have to agree to an extension?
Do not assume so. Your solicitor must assess the contract and applicable law, then advise on available options and how any agreed change should be documented.
Will existing finance arrangements cover a later date?
That needs confirmation. Ask your acquisition finance adviser to establish the current lender position, outstanding requirements and whether the revised date or changed transaction details need further review.
Can I start running the practice while settlement is delayed?
Seek legal and relevant professional advice first. Access, control, client servicing, employment and insurance must be addressed explicitly, because the original planned start date does not resolve those matters.
Should a delay automatically change the purchase price?
No automatic adjustment should be assumed. Raise changed client, staff or financial circumstances with your advisers, and have your solicitor assess the contractual treatment and any proposed negotiation.
Agree a plan that reflects the current transaction
Before working towards another date, bring the legal, funding and operational updates together.
Confirm the current price, acquiring entity, required money and timetable. The next plan should explain what has changed, who resolves what remains and what evidence supports proceeding.
Considering Buying an Accounting Practice?
Discuss the current funding position with your acquisition finance adviser while your solicitor addresses the settlement delay and any revised contractual timetable.
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.
