Exit Readiness Review

Sample Business Ltd (illustrative example)

Financial years ended 31 March 2025 and 31 March 2026

Prepared by Keith Griggs FCA / Fractional CFO, Redbox Financial

This is an illustrative sample. The business and all figures are fictional. A planning aid, not a statutory audit, due diligence or a formal valuation.

The headline

A profitable, growing business whose finance function is not yet ready for a buyer's scrutiny

  • Revenue: £4.2m in FY26, up 16.7% from £3.6m in FY25
  • EBITDA: £520k in FY26, up from £470k in FY25
  • EBITDA margin: 12.4%, down from 13.1%, as overheads grew faster than sales
  • Cash generation lagged profit because customers are paying more slowly

The trading story is good. But a buyer's accountants would find four issues in the records that slow a sale, weaken negotiating position and erode trust. Every one of them is fixable in the next 12 months.

Readiness scorecard

Where the business stands today

  • Records quality: Amber. Suspense items, VAT differences and mixed personal costs need clearing
  • Working capital: Red. Debtor days have risen from 38 to 61 in a year
  • Customer concentration: Amber. The top three customers account for 48% of revenue
  • Owner dependency: Amber. Key customer relationships and pricing decisions sit with the owner
  • Reporting rhythm: Red. No monthly management accounts or rolling cash forecast

1. Records quality

Clean books are the foundation everything else rests on

What we found:

  • £8,900 sitting unexplained in the suspense account
  • The VAT control account differs from submitted returns by £6,200
  • Some non-business costs are coded to the business, making true profit harder to show

What to do:

  • Clear the suspense account and reconcile every balance sheet account monthly
  • Reconcile the VAT control account to the returns and correct any differences
  • Separate non-business costs clearly so the underlying profit is easy to evidence

2. Working capital

Profit is growing, but too much of it is sitting in customers' bank accounts

  • Debtor days: 61 in FY26, up from 38 in FY25
  • Money owed by customers: about £702k at year end
  • At last year's 38 days, that would be about £437k
  • Cash that could be released: about £265k

What to do:

  • Weekly aged debtor review, with named owners for every overdue account
  • Tighten payment terms on new contracts and enforce them
  • Track debtor days on a monthly dashboard so the trend is visible early

3. Customer concentration

Three customers generate almost half of revenue

  • Largest customer: 22% of revenue
  • Top three customers: 48% of revenue
  • Losing one major account would materially change the profit picture

What to do:

  • Put written contracts in place with the largest customers
  • Set a target to bring the largest single customer below 15% of revenue
  • Build a pipeline report showing new-customer revenue each month

4. Owner dependency and reporting

A buyer wants a business that runs, and reports, without the owner in every decision

What we found:

  • No monthly management accounts or board pack
  • No rolling 13-week cash forecast
  • Pricing and key customer relationships held personally by the owner

What to do:

  • Monthly management accounts within 10 working days of month end
  • A rolling 13-week cash forecast and a 12-month budget
  • A one-page KPI dashboard covering margin, debtor days, cash and pipeline
  • Document key processes and share customer relationships across the team

The 12-month readiness plan

Fix the finance side first, so it supports the sale rather than slowing it

  • Months 1 to 3: Clean the records. Suspense, VAT, balance sheet reconciliations, cost separation
  • Months 4 to 6: Release cash. Debtor process, payment terms, monthly dashboard
  • Months 7 to 9: Build the reporting rhythm. Management accounts, cash forecast, budget
  • Months 10 to 12: Reduce risk. Customer contracts, concentration targets, documented processes

By month 12 the business has a clean, consistent set of numbers and a reporting track record that any adviser or buyer can rely on.

Next step

Find out where your business stands

Book a free conversation with Keith Griggs FCA at redboxfinancial.com/call

Phone 07897 020 977

Important: This is an illustrative sample prepared to show the format of an Exit Readiness Review. The business and figures are fictional. A planning aid, not a statutory audit, due diligence or a formal valuation. It does not constitute investment, transaction or valuation advice.

Tanit Services Ltd trading as Redbox Financial. Registered office 124 City Road, London EC1V 2NX. Company number 06354848.