looking at all DD that I have learned, is there anything thing that we have missed out.
what is the important thing that we should look out during the DD process?
One thing I haven’t seen in great length is technology DD, whether that core (main technology of production) as well as supporting enterprise technology such as ERP.
I think the HR DD is very key to success and making sure that there is a some transition but also understanding any hidden cost. The cost of benefits is a huge expense. Our company look attractive but has a major pension issue that would be a red flag for a company looking to purchase us.
In Finance DD I did not notice a major focus towards off balance sheet transactions. These days many companies are involved in off balance sheet financing especially the way leases are accounted and swaps. So any acquirer should pay a great attention to the things behind the veil.
I think with the emergence of technology that we hear almost everyday, the focus of this course will have to increase the time spent in that arena. There are companies I have worked with that have lacked in investing in technology that has significantly impacted the purchase price.
I see all due diligence as of importance but mostly the economic situation of the business. Basically any consistency among accounts, assets, and liabilities. Make sure you are looking at historical trends, projections, and tax risks.
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