Page 122 - PRAGMATIC STRATEGY

C : ACCOUNTS

1 Audited Accounts

In order to obtain a realistic picture of the financial performance of the

company the last three to last five years' audited accounts should be
examined.

2 Management Accounts

Where possible management accounts should be examined,

particularly for the period since the last audit date; assessment on the
reliability of management accounts should be undertaken.

3 Projections

indicate budgets or other company projections of sales, profits and the

rest: where possible indicate current and following years' budgets and
available forward forecasts: break-even calculations; sensitivity
calculations;

4 Special Accounting Items.

indicate any special features in the accounts requiring further attention

or likely to influence the terms of an investment: any audit
qualifications or special observations by auditors.

5 Group Relationships

if applicable, note any transactions with associated or parent

companies, including transfer prices, management charges and
overhead allocations.