If you are a business owner, you are likely aware of the numerous liability issues you need to protect yourself from. One way business owners can ensure they are legally protected is to conduct regular audits of their operations to identify potential legal issues that can result in a lawsuit or lower the value of the company.
What Happens During a Legal Audit?
Business audits generally involve a team of attorneys taking a close look at a company’s records, procedures, and policies. The attorneys will then present any legal issues they encounter to the owner and discuss possible remedies.
Attorneys usually inquire about the following things when conducting an audit:
- Operating agreements
- Equity ownership records
- Articles of incorporation
- Buy-sell agreements
- Local & state licenses
- Tax identification numbers
- Insurance policies
- Service contracts
- Vendor contracts
- Purchase orders
- Service marks
The results of the legal audit will allow you to make an action plan to resolve any issues you have left unaddressed. By implementing the necessary corrective actions, you can avoid ligation from third parties, co-owners, shareholders, and even the IRS. If you are planning to sell your business, a legal audit will allow you to identify issues before the buyer does, this way you will have enough time to fix the problem and retain the value of the sale.
Do you want to find out more about how legal audits can help your business? Then call our legal team at Purdy & Bailey, LLP to schedule your consultation with one of our experienced business attorneys.