An accounting standard is a common set of principles, standards and procedures that define the basis of financial accounting policies and practices. Accounting standards are adopted by companies in India and issued under the supervision of Accounting Standards Board (ASB) which is a committee under Institute of Chartered Accountants of India (ICAI) consisting of representatives from government department, academicians, other professional bodies viz. ICAI, representatives from ASSOCHAM, CII, FICCI, etc.

Read more: Indian Accounting Standard

In this installment of our “M&A Essentials” series — offering a fundamental understanding of the concepts, issues and processes every business owner should be familiar with when considering and conducting the sale of a business — we talk about key areas to address when preparing a company for sale.

Business owners looking to sell often go to an advisor saying something along the lines of “I want to get out …” or “I received an offer to sell …” The timeframe generally is something like “… next year” or worse yet — “I have xx days to respond.”

Read more: M&A Essentials: 3 Key Considerations When Preparing to Sell

Selling a business is a complex endeavor. As advisors to business owners and shareholders of private companies, we have helped companies to navigate the process from beginning to end. We are excited to share those experiences and insights in this new series, “M&A Essentials.” The series will offer a fundamental understanding of the concepts, issues and processes every business owner should be familiar with when considering and conducting the sale of a business.

Today’s post discusses the relationships between a company’s valuation, purchase price and the cash proceeds received from a sale.

Read more: M&A Essentials: Understanding Purchase Price

Authors: Bruce Roher and Meghan Haley

On October 17, 2018, Canada became the first G7 country to legalize marijuana for recreational use. According to U.S. research firms, Arcview Market Research and BDS Analytics, global consumer spending on cannabis will triple from its current level to US $32 billion by 2022.

As beer, alcohol and tobacco sales volumes slow, companies within these industries have been actively acquiring stakes in, or partnering with, cannabis companies. Cannabis-infused food and drink products will be lawful in Canada no later than October 17, 2019, which is bound to further increase M&A activity.

In October 2017, Constellation Brands, a leading beverage alcohol company (best known for Corona beer and Robert Mondavi wine) acquired a 10% stake in Canopy Growth Corporation for $245 million. In August 2018, Constellation Brands increased its ownership interest in Canopy to 38% for $5 billion. There are clearly benefits to both companies.

Read more: Why All the M&A Activity in the Cannabis Market?

The ever-changing environment demands frequent adjustments to be made in the laws of land for efficient and effective management of both business as well as non-business activities. Government has just introduced the Companies (Amendment) Ordinance, 2019 thereby, bringing relevant alterations in Companies Act, 2013 (”Act”). This action has provided an affirmative action that any violation in complying with the set standards will lead to stringent repercussions for both the company and its management.

Read more: Highlights of Companies (Amendment) Ordinance, 2019