Form 2 South Australia
The sale of a small business is regulated under the Land and Business (Sale and Conveyancing) Act 1994. You are legally obliged to provide a prospective buyer with a Vendor's Statement - referred to as a Form 2 in the Act (located between page 67 and 109 of this document) - for the sale of a small business if the business is to be sold for a price of up to $300,000.
This price does not include:
- any land sold with the business
- any stock-in-trade, the value of which is determined according to the usual selling price of the stock.
The vendor’s statement includes:
- the purchaser’s cooling-off rights
- trading statements for the last three financial years
- information about the land being purchased, or the lease or tenancy agreement
- how the business operates - eg company, sole trader)
- information on plant, equipment and stock
- staffing requirements.
The vendor statement must be endorsed by a qualified accountant - who is not the vendor - certifying that he or she has examined the accounts of the business and that the financial particulars disclosed in the statement appear to conform with the accounts.
Where Form 2 does not apply..
Where the business is outside the scope of regulatory requirements the prospective buyer is still likely to require them before making a decision to purchase.