M&A Due Diligence Checklist Leave a comment
A due diligence checklist is a vital tool for ensuring that every aspect of an M&A deal is covered. A thorough due diligence procedure can help make sure that costly mistakes are not made which could cause a halt to a merger or acquisition.
A typical due diligence checklist may include documents pertaining to the company’s legal and financial operations including intellectual property as well as human resources, sales and marketing information, and more. Each checklist will differ dependent on the industry and specific needs of the company.
Financial due diligence (also called accounting due due diligence) is a thorough analysis of a company’s financial position including its accounts payable, receivable, cash flow and tax risks. It must also include an analysis of past trends and projections, as well as the company’s ability to meet its debt and other financial obligations.
Human capital due diligence includes a detailed look at the company’s future and current staffing needs. This includes the list of all employees, their wages and job titles, as well as their skills and qualifications. It should also examine time off policies and the company’s benefit plans.
Operational due-diligence involves a thorough examination of the company’s internal processes and infrastructure, including its supply chain. It can also include an examination of the company’s compliance with various laws and regulations. It may also include a review of the warranty policy of the company price policy, pricing philosophy, and estimation department.
When you’re putting together your due diligence checklist, it’s important to keep it updated as new developments occur. This will ensure that buyers get the most precise information possible. Also, storing records in a structured manner in a folder with clearly defined titles will help buyers to search and locate the required materials.
