Page 235 - AAA Integrated Workbook STUDENT S18-J19

Due diligence

1.5 Benefits of engaging an advisor to carry out due diligence

 Decrease management time spent assessing the acquisition

 dentify operational issues and risks with the target company



 dentify assets not recognised in the financial statements e.g. internally
generated intangible assets.

 athering information on other relevant matters that could influence the
investment

 nhance the credibility of the investment decision

 laNning the acquisition – e.g. provide advice on restructuring and change
management.

 laims made by the vendor can be substantiated

 valuation of possible post acquisition synergies and economies of scale

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