Financial due diligence

Financial Due Diligence

Financial due diligence focuses on analyzing and verifying financial information to evaluate the potential of a business. It is not restricted to proposed merger or acquisition but also related to Joint Ventures financing or other deals or transactions and is expected to consider following areas:

  • Earnings
  • Assets
  • Liabilities
  • Cash flow
  • Debt
  • Management

Independent assessment helps to identify the critical factors for informed decision making and future success. Typically, the process would include document review, trend analysis, discussions, and assessment of the operational situation. The primary objective of financial due diligence for the acquiring party is to establish the current valuation of a target company. It would include evaluating the financial situation and internal controls of the target firm over a period of time. Future financial forecasting forms the basis of current valuation for the acquiring party whereas an understanding of the operational management helps in formulating a post-acquisition business plan.

Corporate Capital Ventures is a specialist in carrying out financial due diligence on behalf of our prestigious clients. Our financial due diligence team consists of practicing chartered accountants and tax specialists ensuring an all-inclusive service. We provide extremely prudent and suggestive reporting for an adept service minimizing financial risks.

Our Financial Due Diligence support would include following activities:

  • Analysis of the recent financial situation and examination of accounting documents.
  • Analyzing the effect of customer contracts, supplier contracts, and employee contracts on revenue.
  • Target company's revenue and margin analysis based on industry sector.
  • Valuation of the target company including identification of value drivers and risk factors.
  • Purchase price based on various methods such as EBITDA & EBIT.
  • Financial forecasts for support in the purchase price negotiation.