Posting for a friend, here is the set up -

He is taking over a majority stake in a company he's worked for for many years, and will continue to increase his ownership over the next few years until he is the sole owner. At this point, they are creating a new entity which will be jointly owned, and on Jan 1, an asset transfer was executed to retire the old (solely owned) entity and put the new (jointly owned) entity in place to run the operations.

However, there is an issue around the timing of some payments: Most customers are charged on the 25th of the month for services to rendered in the month to follow. The current owner's advisor is recognizing payments charged on Dec 25th on the old (solely owned) entities books (makes sense, prepaid income as a liability) but does not recognize that the new entity (jointly owned) is the one that will render the services that have been paid for up front, and as such, should be compensated for that work (and thus clearing the liability from the solely owned entity). Friend is understandably feeling like he being shorted on the first month, seller is seems to be following the advisors position without thinking too hard about it (also understandable since he's had the business for so many years and it's all his money anyway right?).

Not sure what provisions are in their purchase agreement that might resolve this, but from my perspective, it mostly seems to be a timing dispute.

All that said, does anyone have any thoughts on how my friend might to explain this/navigate the situation (diplomatically) ?