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    What is Financial Due Diligence?

    Every investment has its own level of risk, and without due diligence, the investor may be unable to understand that correctly. A systematic process helps to ensure that buyers and other stakeholders are on the same page at the time of a purchase.

    Financial due diligence is the process to verify and review a potential deal and investment opportunity that is used to confirm all relevant facts and financial information, and verification of anything brought up during M&A deals or investment process.

    Introduction to our range of Financial Due Diligence services

    • Assessing the key issues/risks faced by the business
    • Focusing on business drivers behind maintainable profits and cash flows
    • Identifying the key financial risks having potential impact on the transaction

    Scope of work within Financial Due Diligence services

    • Business Operations incl. model, service categories, supply chain, customers
    • Revenue Analysis & Receivables incl. trends, recognition, dependencies, variations
    • Cost and Margin Analysis incl. trends, major drivers, compliance
    • Fixed Assets incl. physical verifications, application, records, depreciation
    • Working Capital incl. collection terms, provisioning, monthly requirements
    • Debt incl. terms, utilization, claim, notices
    • Related Party Transactions incl., terms, personal transactions
    • Financial Statements incl. quality and reliability
    • Human Resources incl. policies, terms, commitments
    • Risk Management incl. availability of SOP, RCM, testing results analysis
    • Examination of availability of assets
    • Analysis of quality of assets

    Our Methodology for Financial Due Diligence

    Plan

    • Understand the business
    • Understand the deal drivers
    • Agree on expectations
    • Desktop research

    Analyse History

    • Review the Financial Information – Basis of value
    • Evaluate the quality of earnings and assets
    • Accounting policies & practices
    • Reliability of systems
    • Relation to audited numbers

    Understand Future

    • Review the assumptions
    • Market studies
    • Compare with business drivers in historical period
    • Review projections in line with History Analysis
    • Understand management views on projections

    Benefits of Financial Due Diligence

    • Issues that could arise during transactions in future can be dealt in advance
    • Helps in making an informed decision when both parties are in a mutual understanding of each other’s financial position
    • Reduces redundancy and provides flexibility in use of deliverables
    • Potential future position of the entity is ascertained as a crucial deal maker or breaker for both entities
    • Understanding the actual financial performance of the organization
    • Informed valuation decisions
    • Transparency and comfort to the acquiring party
    • Clear situation of key strengths and weakness
    • Understanding of potential risks to the buyer

    Our Deliverables

    • Executive Summary
    • Detailed financial due diligence Report
    • Recommendations to the Buyer
    • Financial Analytics

    Adding value to the engagements

    • Bring industry and geography perspective and knowledge
    • Blend transaction, tax & forensic services competencies
    • Transaction specialists with experience of deals covering many different industries
    • Dedicated team of specialists, providing end-to-end solutions

    With our financial due diligence services, we provide valuable information/insights about financial performance of the organization to support the proposed acquisition. It is completed before any deal closes to ensure a buyer with an assurance of what they’re getting.

    Download Our Service Deck Financial Due Diligence

    What can we help you achieve?

    Stay one step ahead in a rapidly changing world and build a sustainable future with us.

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