Our Financial Due Diligence Report serves as a comprehensive tool for auditors to meticulously examine the financial health and operational efficiency of a target company. It aids in identifying and analyzing key financial metrics such as profitability, asset valuation, liabilities, cash flow and working capital requirements. The report also delves into contractual obligations, contingent liabilities, related-party transactions and revenue recognition policies to ensure that all aspects are thoroughly vetted. Additionally, it evaluates projections and assumptions made by management regarding future performance while providing an in-depth review of human resources, IT systems and internal controls.

The Financial Due Diligence Report is an essential document utilized primarily to evaluate the financial stability and business viability of a company before a potential acquisition, merger or investment. This report is crucial for investors and stakeholders to understand the financial health of the target company, identify any critical issues that might impact the transaction's value or structure, and ensure that the investment aligns with their strategic objectives. Additionally, it offers recommendations on deal structuring and post-acquisition integration to maximize value creation. 

Audit procedures include:    

• Obtain and review policies to ensure the accuracy of accounting for revenue deductions, such as returns, rebates and payment/volume discounts.
• Reconcile gross to net revenue.
• Review the “claw back policy,” which refers to reversing discounts by the company in case of sales returns.
• Identify any significant changes in discounts and sales returns.