Business Asset Protection
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Many small companies need business asset protection advice just as much as the global corporations. While national and international corporations often utilize the services of both in-house attorneys and law firms that specialize in business concern, the owner of a small company seldom has these kinds of resources. Some small business owners may not realize how important it can be to their bottom line to seek the assistance of an asset protection firm until something horrible happens, such as a lawsuit, a tax audit, or a security breach, that creates havoc and hardship. By then, it may be too late to do little more than to control and attempt to minimize the damage. King Solomon wisely advised that: "Folly is joy to him that is destitute of wisdom: but a man of understanding walketh uprightly. Without counsel purposes are disappointed: but in the multitude of counsellors they are established" (Proverbs 15:21-22). A business asset protection firm can provide the wise counsel that the owner of a small company needs to ensure he is financially protected should a negative situation arise.
Proper planning begins with the company's formation. When a new venture is being established, the owner or partners need to make a decision on its legal structure. Sole proprietorships and partnerships are the easiest and least expensive options. But these also carry the most risk to the sole proprietor or partners. Basically, these two types of structures don't create a legal separation between an owner's personal and business assets. This means, for example, that if an injury occurs at the company location, the injured party may file a lawsuit against the owner. Should the plaintiff prevail, the owner's personal assets could be at risk. A business asset protection advisor can provide important information on the benefits of structuring a new venture in such a way, perhaps as an LLC (limited liability company) or a corporation so that the company itself is considered a legal entity. Such an arrangement separates the owner's personal and business assets. With such a structure, the owner's personal assets would not be at risk in the event of a lawsuit.
In addition to providing advice on the best way to structure a particular venture, a business asset protection firm can also assist management in appropriate tax strategies. There is nothing wrong with implementing procedures that reduce a company's taxes as long as those procedures comply with the tax code. However, some gray areas exist and it's for this reason that the management will want to be sure that they are working with a reputable, law-abiding firm. It may be helpful, and wise, to seek independent legal counsel before actually implementing recommended tax strategies. A tax audit can be a time-consuming and expensive ordeal that takes resources (both in terms of energy and decreased profits) away from other important priorities. It's probably safe to say that all owners would prefer to spend time and energy managing their businesses instead of going through financial statements and records with a tax auditor. A respectable and knowledgeable business asset protection professional, however, can be a welcome resource for companies when the IRS comes knocking on their doors.
Computer technology plays a part in practically every company's operation. Even the one-person, home office operation usually depends on the internet for its communication, research, marketing, and order-taking features. Financial transactions take place over the internet with increasing frequency as people become more comfortable with shopping and paying bills online. Obviously, many companies store their customers' personal information in databases on servers. This data includes names, addresses, and credit card numbers. Some databases may even include a person's social security number or driver's license number. A business asset protection firm specializing in computer security can assist in minimizing these types of risks by recommending and implementing innovative technologies that protect the company's hardware, software, and its private information. Computer security breaches create a nightmare, especially when proprietary and customers' personal information ends up in the hands of the criminal hackers. Trade secrets, such as recipes, patents, and experiments are vital intangible assets that have value. When these are stolen, a company's competitive edge may be compromised. When thieves access the personal information of customers, these people may find themselves in legal difficulties due to identify theft. Naturally, such an occurrence will result in the victims expressing anger at companies that aren't protective of personal data.
In addition to protecting companies from technological disasters, a business asset protection firm may offer services that protect other assets, such as a warehouse, manufacturing equipment, and office furniture. Advice may be offered on security measures as well as relevant insurance policies that will offset risk. Such a firm may also evaluate and make recommendations regarding employee safety in the workplace and set up procedures for the reporting and managing of any accidents that do occur so that both injuries and costs are minimal. Professionals such as physicians, attorneys, and accountants may seek the services of an asset protection firm to assist in the purchase of malpractice or malfeasance insurance policies. These individuals also will need to be sure that their personal assets are separated from professional assets to safeguard net worth. Members of a corporation's board of directors are advised to purchase errors and omissions insurance policies to protect them from potential legal hassles. Finally, a business asset protection firm can assist owners with succession and estate planning. Effective planning ensures that the company that someone has devoted his life to building will continue after the founder's retirement or death.
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