The AMA Handbook of Due Diligence is the most complete guide available on how to properly perform a due diligence investigation — and radically improve the success rate of a pending corporate merger or acquisition. The new edition of this long-trusted resource includes a CD-ROM packed with almost 400 customizable forms and templates for recording and analyzing every possible operational or financial activity at any organization.
Extensively revised and updated, the book reflects significant changes in the financial landscape such as the Sarbanes-Oxley Act. There are specialized sections on joint ventures, franchises, and outsourcing, as well as new legal memo and form requirements, including data room index, preliminary diligence memorandum, and the Hart-Scott-Rodino questionnaire. Thorough and easy to use, this essential resource will ensure that every “t? is crossed, every “i? dotted…and no mistakes left out on the table.
Table of Contents
List of Forms v
1. Preface 1
2. How To Use The Due Diligence Handbook 15
3. Overview Of Entity 21
4. Compatibility With Investment / Acquisition Objectives 29
5. Capitalization And Ownership 49
6. Organization And Management 67
7. Relationships With Outside Organizations 89
8. Description Of Products And/Or Services 105
9. Revenues And Market Share 151
10. Marketing Operations 195
11. Customer Service 261
12. Inventory Control And Purchasing 277
13. Production 311
14. Physical Distribution 363
15. Computer, Communications And Information Systems 389
16. Financial Management 419
17. Legal Affairs 469
18. Security And Safety 495
19. Human Resources 505
20. Land And Buildings 541
21. Introduction To Financial Analyses 559
22. Balance Sheet Analysis – Liabilities 565
23. Revenues 587
24. Operating Expenses 593
25. Income Taxes 613
26. Net Income 621
27. Capital Expenditures 627
28. Cash Flow 633
29. Financial Ratio Analysis 639
30. Income Statement Projections 657
31. Balance Sheet Projections 679
32. Cash Flow Projections 699
33. Due Diligence Checklists 707
34. Transaction – Specific Due Diligence Checklists For Acquisitions Or Investments On
Specific Dealings In Selected Industries 727
35. Sample Forms Related To Effective Due Diligence 737
36. Due Diligence Checklists For Special Situations 769
Appendix A: Bibliography And Recommended Further Reading 791
Appendix B: A Selection Of Blank Forms 793
Index 799
About the Authors 827
