Due diligence is a core part of any deal which helps investors gauge at all aspects of the business before deciding on the planned M&A.
The due diligence process is a thorough analysis of the commercial, financial, tax and legal aspects of the company. As a result, we prepare a report which provides a detailed overview of the company under consideration, so you could make an informed decision.
This will help you get a better understanding of the target business and key business drivers, identify relevant issues originating from the analysis and get clear conclusions and recommendations on the matters.
Financial due diligence
Financial due diligence varies notably from a financial statement audit, as it analyses and explains the reasons and drivers behind the financial numbers and changes in business performance.
This could mean focusing on:
- Quality of earnings - validating management adjustments, considering findings in the due diligence and one-off items, and the impacts of accounting estimates;
- Historical trading results - analyzing growth drivers, top customers, revenue and margin development per client, segment or product and KPI’s relevant to the field;
- Analysis of net debt to identify potential debt-like items and the seasonality and requirements of working capital;
- Quality of financial and management reporting - commenting on the finance functions and controls, reporting and budgeting process etc.
The scope of the due diligence depends on the company and we work together with you to put together a scope that will help you in achieving your goals.
A thorough due diligence will help you reduce risks, identify key matters for purchase agreement negotiations and post transaction integration of the target, and make sure there are no surprises at later stages.