The due diligence process is all about mitigating investment risks. By the end of our due diligence process, you should have a fair idea of whether the client or business you are thinking of dealing with is worth the investing of your time; or whether the business you wish to acquire is worth the investing of your money. A comprehensive due diligence is a financial, legal, operations and human resources investigation on a particular company or entity, comprising the risk reviews in respect of a particular company or entity. It is usually required in respect of potential acquisitions or mergers and consists of the following checks:
- The past and forecast financial performance of the business.
- Key indicator reviews completed (ROI, cash flows, ratio, profit margin).
- Share dealing and ownership.
- Directors, board activities and background.
- Review of representations and warranties to determine reasonableness based upon the transaction.
- Valuation of property and other assets.
- Legal and tax compliance.
- Outstanding legal action against the business and its legal history.
- Major customer contracts.
- Benchmarking against key competitive metrics.
- Intellectual property protection.
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