Post-Acquisition Integration Readiness

Where does the transaction stand today?

Timing drives the whole assessment: before closing you can still design control of cash and the opening balance sheet; within the first year you can correct provisional amounts through measurement-period adjustments under ASC 805; beyond a year the remaining work is remediation and value capture rather than planning. Answer from the legal closing date, not the announcement date.

Use the interactive tool above to see how this applies to your situation.

Official guidance: SBA guidance for closing or selling a business

Do you have a written day-one finance plan - bank accounts and signatories, payment release approvals, payroll continuity, and any transition services agreement - ready to execute at closing?

The most common integration failure is closing without control of the target's cash: payments keep flowing under seller-era approvals, signatories are never switched, and payroll runs on access nobody on your side holds. Green Book Principle 10 frames these as control activities that must be designed before the risk event, not reconstructed after it.

Control of the target's cash and payments must be secured at closing - build the day-one plan before the closing documents are signed.

Official guidance: SBA guidance for closing or selling a business

Have you scoped the opening balance sheet and purchase accounting workplan - valuation support engaged, identifiable intangibles and assumed liabilities inventoried, and a timetable that fits the one-year measurement period?

ASC 805-20-25-1 requires recognizing the identifiable assets acquired and liabilities assumed as of the acquisition date, measured at fair value under ASC 805-20-30-1, and the one-year measurement period starts at closing. Deals that defer this work routinely miss intangibles, acquired contract liabilities (ASU 2021-08), and pre-acquisition contingencies, and pay for it later in audit adjustments.

ASC 805 (Business Combinations) governs recognition and measurement of the opening balance sheet, the measurement period, and the required disclosures.

Official guidance: SBA guidance for closing or selling a business

• FASB Accounting Standards Codification

Since the acquisition date, has your team controlled the target's cash and payments - bank account access, updated signatories, and release approval over disbursements and payroll?

Cash control is the day-one test of the acquisition: Green Book Principle 10 places authorization and approval of transactions among the core control activities, and until those sit with the acquirer the target's cash operates outside your control environment. Check the actual bank mandates rather than the org chart - stale signatories survive closings surprisingly often.

Treat this as the first priority - until signatories and payment approvals are yours, every other integration task is secondary.

Official guidance: SBA guidance for closing or selling a business

Is the opening balance sheet and purchase accounting on track - valuations progressing, provisional amounts recorded with support, and open items scheduled to close inside the one-year measurement period?

ASC 805-10-25-13 permits provisional amounts while information is gathered, but ASC 805-10-25-14 ends the measurement period no later than one year after the acquisition date; after that, revisions are corrections of errors under ASC 250-10 rather than measurement-period adjustments. If the deal closed more than a year ago, answer no unless the purchase accounting is genuinely complete and supported.

Review the ASC 805 measurement-period guidance before finalizing or adjusting provisional opening balance sheet amounts.

Official guidance: SBA guidance for closing or selling a business

• FASB Accounting Standards Codification

How far along is the chart-of-accounts and accounting policy mapping between the target and your books?

Mapping is more than relabeling accounts: differences in revenue recognition, capitalization thresholds, inventory costing, and reserve methodologies must be catalogued and either conformed to acquirer policy or bridged with documented adjustments. Green Book Principle 13 requires quality information for decision-making - a consolidation built on an undocumented spreadsheet bridge fails that test.

Finish the line-level mapping and the policy difference catalogue - manual reclassification is where consolidation errors breed. Build the chart-of-accounts bridge and policy alignment first - every downstream close, report, and covenant calculation depends on it.

Official guidance: SBA guidance for closing or selling a business

Have the close calendars been merged and the systems cutover sequenced - one consolidated close timetable with named owners, and a dated cutover plan with parallel-run and reconciliation steps?

Two closes that meet in a spreadsheet is a temporary state, not an operating model. Sequence the cutover so migrated balances are reconciled to the source system before the old ledger is retired, and keep a parallel run for at least one full close; Green Book Principles 11 and 12 cover designing and implementing control over the information system through exactly this kind of change.

Merge the close calendar and sequence the cutover deliberately - a rushed migration without a parallel run and reconciliation is how opening balances get corrupted.

Official guidance: SBA guidance for closing or selling a business

Have you identified the target finance staff who carry critical knowledge - close, billing, payroll, tax, systems - and put retention and knowledge-transfer arrangements in place for them?

Green Book Principle 4 - commitment to competence - extends to succession and contingency planning for key roles. In an integration the risk is acute: the seller's controller, billing lead, or systems administrator often holds undocumented knowledge, and attrition spikes in the first year after closing. Retention terms, transition agreements, and forced documentation are the standard tools.

Secure the people before the process - undocumented knowledge walks out the door during integrations, usually at the worst possible moment.

Official guidance: SBA guidance for closing or selling a business

How are the deal's synergies tracked?

Synergy capture is a monitoring problem: Green Book Principle 16 calls for ongoing monitoring against an established baseline. The working standard is a quantified baseline tied to the deal model, one accountable owner per initiative, and a monthly or quarterly review that reports realized versus planned synergies to whoever approved the deal.

Principle 16 describes the monitoring activities that turn synergy targets and post-close controls into measured, reviewed commitments.

Official guidance: SBA guidance for closing or selling a business

• GAO Standards for Internal Control (Green Book)