Business risks come in all forms and sizes. As a business owner you accept these risks as being part of your decision to become an entrepreneur. You know that there positive trade offs to these risks such as flexibility, ownership, control, building value, etc. but as cherished as these benefits are business owners do not take appropriate measures to mitigate the risk exposure they have within their practices. These risks can be magnified during the acquisition process. In addition, new risks can be introduced that weren’t a factor previously.

It is important that advisors take appropriate steps to limit their exposure to liability and business risks through proper due diligence and post-transaction planning.

Additionally, advisors should evaluate if their business is protected from death or disability of key employees, have a disaster recovery plan in place, ensure non-compete agreements are used, and have proper E&O coverage. Taking these steps prior to an unfortunate event will help limit unforeseen risk exposure.