Due diligence relates to the process of research, investigation, inquiry, study and analysis that is done before an acquisition, investment or partnership to ascertain the value of the subject of the due diligence or whether there are any significant issues. The prospective acquirer/investor should assemble all the necessary information within the predetermined period.
The need for due diligence exercise can be reasonably associated with the phrase forewarned is forearmed. Though the due diligence is not a panacea against investment failures, it renders the likely buyer with proper information. It aims to acquire, and assists manage associated risks.
What SAAAR Offers?
Before starting any project, we discuss with the client the issues that are of primary concern. In the end, the client receives a due diligence report containing all findings. Our approach is to save time, money and efforts and to support in influencing the price at the outset of the deal. We provide best due diligence services in Delhi and serve our clients in managing financial, legal and accounting reviews.
How can SAAAR help?
- We manage due diligence with the sole purpose to create valuable and precisely estimated reports and productive business analyses for our clients which is an integral segment of their decision-making and negotiation processes.
- We assess the records and reports of the internal controls of the business by carrying out an effective due diligence audit. We also examine their comprehensiveness and sufficiency and the level of importance and relevance attached to them by the organisation. An organisation that allows internal control processes to weaken or does not take action on problems surfaced by the controls loses its credibility.
- To sharpen on rendering value-added services that intensify client business decisions by combining a thorough understanding of technologies, logistics, corporate strategy and finance with an ability to summarise complex issues into concise, easily understood terms.
- Our basic role in a financial due diligence review includes evaluation of the proposed deal by properly analysing the present and historical financial statements including relevant agreements reviewing the control environment and assessing the risk incidental to the business
- When firms acquire a business, dispose of a non-core business or go into a merger, they necessitate managing the tax risk utilising a tax due diligence. We provide you with corporate tax, social security and direct and indirect taxes due diligence while focusing on risks (comprising quantifications) as well as opportunities.
- Within a merger and acquisition process, any responsible administration will entail a comprehensive and thorough assessment of the potential legal risks related to the corporate status, contracts, securities, assets and intellectual property of the target company regarded. The negotiation of the transaction will, in most cases, need the intervention of a legal expert as many legal pitfalls need to be tackled. Also, the drafting of the contracts and associated documents cannot be executed without appropriate attention from a business angle.
We, at SAAAR, aim to enable entrepreneurs and decision-makers to make sound investment decisions with high confidence at every stage and eliminating the risk and potential flaws of investing in domestic and international locals. If you are seeking Due Diligence Advisory Services in Delhi, reach out to us at info@saaar.co.in
Frequently Asked Questions
- Who is required to get due diligence?
Any person wishing to buy an established business must assess its value and the risks associated with buying it. Before signing the contract, he must have access to important and confidential information about the business within the time period specified in a letter of intent. Also, before investing funds in the shares of a company or any other investment avenue, the investors must make sure that it is worth the investment. Hence, the potential investors and buyers must get due diligence carried out to make informed decisions.
- Is due diligence mandatorily required under any statute?
No. Due diligence is not required under any statute.
- For what purpose due diligence is required?
The purpose of due diligence is to lower exposure to risk. The process ensures that a party is aware of all the details of a transaction before they agree to it. Due diligence contributes to making informed decisions by enhancing the quality of information available to decision-makers.
- What are the benefits of due diligence?
There are various benefits of due diligence as it helps to:
* verify information brought up during the deal or investment process,
* identify potential defects in the deal or investment opportunity and thus avoid a bad business transaction,
* ensure that the deal or investment opportunity complies with the pre-determined criteria,
* create greater awareness, clearer expectations, and increased comfort for the buyer and seller of what’s expected of them to close the deal,
* analyse the risk and predict any unforeseeable threats in the deal, and
* reduce the knowledge gap between buyer and seller, leading to more-informed decisions.
- What are the types of due diligence?
There are four major types of due diligence:
* Financial due diligence: It focuses on the company’s financial performance till the present date and ensures that the numbers shown in the financial statements are correct and sustainable.
* Legal due diligence: It focuses on all legal aspects of the company and its relationships with its stakeholders. Areas generally analysed include regulatory issues, contracts, licences, and any legal liabilities that may be pending.
* Operational due diligence: It focuses on the company’s operations-basically, looking at how the company turns inputs into outputs. This is usually considered to be the most forward-looking kind of due diligence.
* Tax due diligence: It focuses on all the tax affairs of the company and ensures that its tax liabilities are settled in full to date. Due diligence in tax also finds out at how a merger would affect the tax liabilities of the new entity formed by the transaction.
