New company using prior owner's QB file

I have encountered this many times.  I even had a client that set up a very complicated chart of accounts, huge class list and a multitude of memorized report.  Owner was trying to micro-manage every aspect of the business, but the ladies that did the books could not break everything down to the level he wanted.  In the end, it was a mess and the P&L was 5 pages long.  None of it made sense.  I warned him many times that we was on the wrong path.  After two years, I terminated our relationship.  He didn't know what he wanted and I it too tremendous effort on my part to create financial statements and the tax returns were a nightmare.

Give your client what he wants.  Warn him.  Charge him very high rates for your work. 

If this is not an entity Sale, then here is the Answer to use for this: "I cannot convince him that this is not the right way to do it.  Not the right way to start this new business."

You bought a "business" but if you did not buy the Entity, these are not Your Financial transactions. That is not your payroll to date, not your expense, not your income, not your debt, not your Fixed Asset basis, and not your Depreciation. These are not your Draws or Distributions, not your Equity, this does not reflect your Investment.

Often, this isn't even set up for your own Tax Filing.

Use all of that. Never give them "what they want" when it isn't what you or they should be doing per the legal and tax regulations that apply.