Due Diligence Checklists: Things to Do and to Check Before Acquisition
What to Consider When Going for Due Diligence
The due diligence’s objective is rather straightforward and simple. In fact, the acquirer is willing to minimize its exposure to all problems and pitfalls, which might occur upon acquisition. The process of due diligence itself is decidedly simpler. Nevertheless, you should bear in mind that good due diligence should start well before an acquisition prospect is identified. It is highly advisable for the buyer to beforehand determine the desirable and undesirable characteristics.
However, it is for certain that a comprehensive due-diligence investigation is of paramount importance for the success of any acquisition. Indeed, before conducting a deal, you have to spend an extraordinary amount of time interviewing customers, competitors, suppliers, and management to receive a wide understanding of the core target’s value drivers and all possible business risks. You should have access to important information about the business you’re buying and that is where virtual data rooms become useful.
Typical Steps for a Due Diligence Process Include:
· Look for, check and hire experts that are skilled in analyzing businesses to assist you with the whole due diligence process.
· Gather as much information as possible about the firm’s business structure and practices.
· Study all the customer data provided by the seller, in particular, market research, service agreements, advertising campaigns, return policies, sales policies, and credit policies before buying. This should also include:
- Carefully examine contracts and agreements with suppliers and subcontractors.
- Scrutinize personnel records, in particular, full- and part-time employees, board members, and subcontractors.
- Acquire legal documents and history for pending or threatened litigation.
- Inventory all physical assets.
- Review all insurance policies and insurance claims as part of the due diligence process.
· Check out both existing products or services and those, which are being developed.
· Choose the appropriate storage for your deals. Needless to add, these days there is no need to attend physical data rooms to view all information regarding the deal since there are virtual data rooms. Unlike physical ones, you can access them any time of the day and night. Besides, using a trustworthy online data repository, such as iDeals, offers you a number of benefits that will be of vital use during acquisition.
Top Advantages of iDeals VDR Are:
· The possibility to securely store and share all confidential data online along with data leakage prevention. All data within VDR is encrypted.
· Full control over your data. You can set different permissions to various documents and groups. In other words, you decide which information which members of the deal can access, view and print. This also includes restrict group access by level, date, and IP-address. Plus, to protect the most confidential docs, you can utilize digital watermarks and fence view options.
· Amazing Microsoft Office integration, plus the possibility to edit Excel files online.
· Synchronization and integration.
· Login with two-step authentication.
· Access administrative and compliance reporting with a full audit trail of all activity within your VDR.