Financial‎‎‎‏‏‎ ‎‎Due‏‏‎ Diligence

a. Review of Financial statements:

• Review of the full set of Financial Statements and Management Reports (Balance Sheet, Profit and Loss and Cash Flow) with the aim to identify main financial risks
• Review of the main revenue and costs drivers of the business
• Review of the quality of net assets

b. Main financial elements to enhance power of negotiating the transaction price:

• Identifying the main risks/elements that could affect the price of the transaction
• Recommendations on the approach to include such elements in negotiation of the price

c. Assistance to include financial implications in transaction documentation:

• Review of the transaction documentation to ensure addressing the financial risks identified in due diligence, the transaction price negotiated and any pre and post closing of transaction financial requirements

Financial Management

• Setup of a Management Reporting Pack or review of the existing pack to meet the information needs of the Board and middle management and to align financial objectives across the organization
• Establishment of the budgeting process or review of the existing budget process
• Implementation of processes to ensure efficiencies across the organization
• Development of a reporting format to measure actual results versus budget
• Review of internal procedures and assistance in building the necessary procedures across the entity
• Review of the Treasury function to ensure the business has adapted access to the necessary cash flows
• Temporary CFO function
• Review of accounting processes to increase efficiency

Preparation for investors/EXIT

• Setup or review of the Business Plan to include and validate the main business assumptions
• Setup or review of the existing Management Reporting Pack
• Assistance with the Company’s financial presentation to investors
• Preparation of the owners to familiarize them with the investment/exit process, including special terms and investor expectations
• Pre-work with the financial team for the financial due diligence required by the investor
• Review of internal procedures to ensure compliance with an investor’s minimum requirements
• Assessment of the segregation between Board activities, management activities, and owner activities

Pre-Work for Independent Financial Audit

• Familiarization of the management team and separately, of the financial team, with the usual requirements of a financial audit, from practical points of view
• Review of the available financial information to identify potential bottlenecks in the process, having in mind what type of information auditors usually require
• Review of the business drivers (both revenues and costs related) to identify potential adjustments to the financial statements needed to ensure a clear audit opinion on the financial statements
• Set up a calendar to ensure resources within the Company are efficiently allocated for the audit process, avoiding delays and additional costs in the audit process
• Assistance of the financial team to prepare the full set of Financial Statements to be audited

Training – Finance for Non-Finance

• Training designed specifically for non-financial departments (marketing, logistics, production, administrative) to establish a common understanding of financial concepts and vocabulary
• Integrated financial training through business case role-playing exercises that place participants in unfamiliar functions to understand and use relevant financial elements
• Special-purpose training as required by the organization (e.g., specialized budgeting, report usage, induction for new employees, or during mergers and acquisitions)

Special purpose engagements

• Review of contracts for financial implications
• Pre-merger/acquisition review of financial implications
• Review of costing systems in production activities
• Analysis of other situations where financial implications or risks need to be identified

Internal Audit Function

• Assistance in setting up an internal audit function
• Review of an existing internal audit function to identify areas for improvement, particularly in fast-growing companies where internal procedures may lag behind organizational needs