Financial Due Diligence

Financial Due Diligence is a reasonable level of enquiry into the financial affairs having a material impact on the prospects of the business. A FDD review may not only look at the historical financial performance of a business but also generally consider the forecast financial performance also. The objective is to ensure that prospective investors make an informed investment decision. It is a fact gathering exercise with a focused analysis of information.

The main sources of information for a FDD review include:

  •   Historical financial data including statutory accounts, detailed management accounts and reports and income tax returns.
  •   Current financial data such as year-to-date management accounts.
  •   Minutes of Directors’ Meetings and Management Meetings.

FDD is about Evaluation, Interpretation and Communication Our firm provides services in FDD covering the above aspects in the areas of:

  •   Disinvestments.
  •   Strategic investments or a PE investment.
  •   Acquisition of an undertaking / business.
  •   Inbound and overseas investments.
  •   Listing of securities in Indian or overseas market.
  •   Vendor due diligence – for sale, supply or business arrangement.
  •   Specific audit study – to ensure utilizations of any grants or support.