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How to Accurately Calculate Gross Margins (and Understanding Their Importance) at Professional Services Firms

Focus Investment Banking

If you’re considering the sale of your consulting or professional services business, you should understand that buyers will be examining your Gross Margin as an indicator of the value of your firm. Professional services companies make money by billing out their experts and consultants at rates higher than the employee cost.

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How to Calculate Cost of Goods Sold (COGS) for SaaS Companies w/ Examples

Software Equity Group

While Cost of Goods Sold, or COGS as it’s known in the world of accounting, is a seemingly straightforward principle, it is frequently miscalculated by software company entrepreneurs. Speaking broadly, your COGS structure will likely include technical support, professional services, customer success, and developmental operations.

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LLP: All You Need To Know About Limited Liability Partnership

Razorpay

But in an LLP no partner is liable on account of the independent or unauthorized actions of other partners, thus protecting the personal assets of individual partners. All partners of limited liability partnerships share the profits of business just as partners of regular firms. What is Liability?

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What is a Partnership? Exploring Types of Business Partnership

Peak Frameworks

In return, each partner shares in the profits and losses of the business. This structure is commonly used in professional services firms, such as law firms and accounting practices. Similarly, profits should be distributed according to the stipulations in the partnership agreement.

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Thinking of Selling Your Business? Why You Need a Sell-Side Quality of Earnings Report

Chesapeake Corporate Advisors

Why You Need a Sell-Side QofE When Selling Your Business At a high level, a sell-side QofE report analyzes and validates your business’s profitability, assessing both revenue and costs. Credibility A QofE is considered more justifiable than accountant-prepared financials that are only reviewed or compiled. Net Working Capital.

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10 Concepts You and I Can Learn About M&A and Creative Deal Structuring From How2Exit's Interview With Roland Frasier Investor, Business Mentor and Strategist

How2Exit

He realized that if he could buy enough companies, he could exit several of them a year and receive a large amount of profit in one go. However, many of these people find that they haven't built a sellable business and don't know how to professionalize it. Roland's story is a great example of how it is possible to play a bigger game.

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Useful Software Industry Acronyms for Executives

Software Equity Group

EBITDA (Cash-Adjusted): Earnings Before Interest, Taxes, Depreciation & Amortization You are likely familiar with EBITDA (earnings before interest, taxes, depreciation, and amortization), used to measure profitability. The cash accounting or the accrual method is used to prepare P&L statements.