Key Determinants for A Due Diligence Checklist .
Prior to signing any contract its important to engage in the due diligence process . The activity gives the investor a detailed scope of the company's structure before signing of any deal . This corporate due diligence is key to any merger and acquisition process that is about to take place. Before getting to finalize any deal the buyer or the seller should make sure to learn key information regarding the company .
Contract signing should only take place once an investor has carried out the due diligence process of the target company. The information is key to getting the scope on the pricing of the deal . Corporate due diligence executive protection makes an investor understand if the target company is viable commercially. The company will not have to halt its usual business activities for this process as the company's lawyer is in a position to provide the information to the investor.
The crucial information regarding the due diligence process is outlined below. The information to be provided will be determined by the company and also the type of deal involved.
The company's lawyer is in a capacity to assess the structure of the company and also the general matters. Its crucial for any investor to familiarize themselves with the day to day running of the target company . The lawyer will provide important information such as financial statements of the company for the last five years . The company's statistics regarding its creditworthiness and its liabilities should also be provided .
Company's history of tax payment is also crucial . This ensures that an investor has the knowledge of whether the company oblige in payment of taxes. The tax to be carried forward when the deal is signed is put to light for the investor.
It is important to learn of the company's compatibility with what you are currently involved in. This will help an investor understand whether the company fits to what your business is currently doing .
Any contracts signed before the merger and acquisition should be brought to the investor's awareness as its very key. The investor should enlighten himself regarding various contracts by the company such as employment contracts, franchising agreement etc.
It is key to know the company's structure and also its employee base . It doesn't really matter if the employees will be affected by the merger and acquisition it's crucial to have the information .
The material asset of the company is also a key factor to consider as an investor . A company's debts and liabilities that are against the company material assets is important information for any investor.
To avoid any surprises an investor should do the due diligence exhaustively .