12. How to Talk to Clients About Their Financials (Without Losing Them)

giving brokers the language and confidence to tackle tough conversations with clarity and respect

Numbers make or break a deal, but they can also break the relationship.

Most brokers know this moment.You ask for financials, and the seller gets -

• Defensive

• Vague

• Embarrassed

• Or insists that “my accountant has it all” - but nothing is ready

 It’s frustrating, but underneath the resistance is something deeper - fear, shame, or simply not knowing what to say.

💭 Why Sellers Get Weird About Financials

• They don’t understand them
  Many small business owners run from cash flow, not toward it.

• They’re ashamed of messy books
  Especially if they’ve done some “creative accounting.”

• They fear being judged
  The numbers feel like a reflection of their competence.

• They’ve never had to defend them
  This is the first time someone’s looking closely.

🛠 Your Role - Reassure + Require

Here’s the balance -

Reassure them that imperfection is normal.
But be clear that clarity is non-negotiable.

You’re not there to audit them. You’re there to help them prepare for someone who will.

🧠 Language Brokers Can Use to Reduce Tension

Here are five phrases that calm the seller while moving the conversation forward -

• “You don’t need perfect books - you need honest ones.”

• “Buyers don’t expect perfection - they expect predictability.”

• “Let’s make sure there are no surprises during due diligence.”

• “We’re on the same team here. I want to help you present the business at its best.”

• “What we don’t explain now, the buyer will question later and that costs more.”

🔍 The 5 Financial Questions You Have to Ask

These are the non-negotiables - even if they make the seller squirm a bit -

1. Can I see 3 years of financials - P&L, balance sheet, and cash flow?

2. Are there any expenses that don’t reflect the true cost of operations?

3. How are wages allocated - including owner’s salary?

4. Are there any one-off events in the numbers (good or bad)?

5. Have your financials been reviewed or signed off by an accountant?

If you can’t get clear answers here, the deal will stall later - guaranteed.

🧩 When the Numbers Don’t Add Up

Here’s what to do when you suspect the financials are a mess (but the seller is defensive) -

• Ask for raw data and offer to help structure it

• Bring in an independent accountant to clean things up

• Be transparent: “I can’t take this to market until we know what we’re presenting.”

🧰 Broker Tools That Help

• A financial prep checklist (PDF)

• A “Your Financial Story” worksheet for sellers

• Example deal memos with real-world financial summaries

• Referral partners: bookkeepers, accountants, CFOs

These tools shift the tone from interrogation to collaboration.

🤝 Final Thought

You don’t need to be an accountant to have financial conversations, but you do need to be confident, clear, and compassionate.

Sellers aren’t always resistant because they’re difficult. Often, they just don’t know what’s expected of them and they’re afraid to ask.

You can lead that conversation and earn their trust by doing so.

If you’re dealing with a seller who’s stalling, struggling, or slipping into avoidance around the numbers, let’s talk. I’ll help you move it forward with empathy and authority.

👉 Book a 15-min financials strategy call https://www.regenerationhq.co.nz/contact
👉 Or reply to john.luxton@regenerationhq.co.nz and I’ll send you a script you can use this week.