The role of financial due diligence in acquiring a business is as critical to success as a structural survey to the purchase of a property.
You may have background information on your target and have started to look at funding options. But how reliable is your information? And how can be sure there are no significant issues that you aren't aware of?
This is where financial due diligence plays a crucial role in any proposed transaction.
- Our team of experienced professionals has many years' experience of looking at businesses to assess the quality of the information they produce. Our investigation includes an examination of specific issues that you have identified, as well as further in-depth assessment.
- You will receive our frank and objective opinion on the key issues emerging from our examination. If necessary, this will enable you to revise your plans and assumptions.
- Although deal-breaking situations are rare, there are occasions when due diligence has prevented prospective purchasers from losing large sums of money on businesses with major hidden problems.
- Our transaction services specialists check the assumptions underpinning your plans and provide assurance that your decisions are based on full and accurate information.
- Our approach is flexible and tailored to the specific needs of each assignment. Whether you want an extensive, full due diligence review or simply want to use our expertise to check out certain aspects of a target, we will work with you to deliver the information you need, when you need it.
Independent business review
Independent business reviews incorporate many of the elements of a due diligence assignment but are used in more varied circumstances. They look at broader issues than the financial health of the business and often incorporate valuation.
For funders, the objective of an independent business review is to report on the effectiveness of financial controls; to review the viability of the financial forecasts; and comment on key sensitivities.
For purchasers, independent business reviews provide additional assurance that the purchase price of the company they are buying is fair. An independent business review can also be a useful tool for appraising your own company.
Key stages of due diligence
There are several key stages to the financial due diligence process:
- Meeting with you to discuss in detail your plans and assumptions so that we fully understand your motivation for the proposed acquisition and the key issues for you.
- Preparing a detailed schedule of work for our assignment and agreeing this with you to ensure that we meet all of your needs.
- Information gathering, which can include various background checks on the target business, meeting with its internal and external accountants, reviewing audit files and then a visit to the company to review key documentation and records and to discuss the business with the proprietors and key employees.
- Preparation of a draft report, highlighting significant issues and making specific recommendations for addressing them.
- Discussion of the draft report with the vendors of the business, to present our findings.
- Discussion of the draft report with you to report our findings and to discuss any key issues that impact on your proposed deal, and if necessary to agree further work that may be required.
- A review of your business plan and forecasts in light of the findings of our report to help you to update your proposals.
For more information contact a member or our team below:
Head of Investor Due Diligence0151 2552300Liverpool & Manchester
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MC Vanguard Corporate Finance is the trading name of MC Vanguard Corporate Finance Limited
Registered in England & Wales No. 7862991 Registered Office: 5 Temple Square, Temple Street, Liverpool, L2 5RH