I am doing due diligence on a park and trying to feel comfortable with actual revenues of the park. The sellers have provided qb P&L for 2010, 2011, 2012, 2013 and tax returns (from 8825) for 2010, 2011, 2012 showing revenue. The qb files and tax returns match so that is good. They also shared an aging report that did not match with revenues in the qb 2014 ytd P&L.They will not share bank statements because they use the bank account for several properties. I asked they copy checks/deposit slips for October and September. Relator thought they could get that for October but probably not September. I also asked for a copy of the 2013 return. What else can I do to feel comfortable with the revenues?
Did they provide a rent roll with tenant names? Does the park have a manager and does he or she know you are buying the park? You can review the rent roll with the manager and ask who is late paying and who doesn’t pay. You can start the conversation with “As you know I’m buying the park so I need you as the manager to be honest with me…” . The manager will not benefit from deceiving the future owner.
They did provide a rent roll. But there is no manager. I compared quickbook statements to the tax returns and they match. So things seem to be be good.
Good to hear. Let us know how it turns out.