Due Diligence is generally used as the pre-investment intelligence tool by investing partners / stakeholders to obtain the advanced and independent report relating to the investee’s credentials.
Due Diligence Review (DDR) is a process in which an individual or an organization need ample information about a business entity to attain conversant conclusion as to its importance for a specific purpose. To purchase a business is generally dependent on the due diligence analysis and report. The Due Diligence Review is to review financial and legal records including anything else supposed material to the sale.
To get hold of of a business takes with it the numerous risks in different areas like management & workforce, markets & products, strategic and unrecorded liabilities, financial, legal & litigation. The company gathers work plans to meet client expectations and goals to offer assurance of smooth acquisition.
On the other hand, sellers could also request due diligence analysis on the buyer to get help to decide on the ability of the buyer’s to purchase and to be aware of the factors that can play significant role in position of entity after sale.
Here are some reasons for which Due Dilligence Review is carried out:
Due Dilligence Review is not an audit but it is much broader than audit. Therefore, DDR requires skill set and experience that go beyond conventional audit. We can consider it the business oriented, not the bookkeeping or record checking or account oriented. Due Dilligence Review need understanding of the business, its pattern, business trends and much important the risk estimation.
There are different types of DDR:
System of DDR will depend upon the requirements of the client, time on hand and nature of review. At Parikh & Associates, we follow the steps listed below:
We always prefer to discuss with the client the span of DDR to provide the best consultation for the DUE DILIGENCE REVIEW. It is not limited to monetary due diligence but extends to technical due diligence, systems due diligence, market due diligence, operational due diligence, legal due diligence, etc. All of these make the foundation of comprehensive DDR for the following goal.
The operations for DDR are depend upon the nature of the goal and span define by the client. At the time, level of the comfort and the structure of the acquisition decided.
The proper lines of actions are as follows:
The experts working for the DDR know the intrinsic risk and are prepared to face the compensation of the resulting loss, if any. The team assures for the following matters:
The expert team at Parikh & Associates works to avoid risk and take undertakings from authorities that encompass as follows:
At Parikh & Associates, we offer services to bankers, Investors, and acquirers who rely on Due Diligence as a standard of support for the duration of Mergers and Acquisitions.