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Financial Due Diligence Accounting Support for Transactions and Business Reviews

Prepare clearer financial information for a transaction, investment, lender review or strategic business assessment. CorporateWalla can support financial due diligence with accounting-data analysis, reconciliations, working-capital schedules, debt and cash review, historical financial analysis and management reporting.

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What Is Financial Due Diligence?

Financial due diligence examines the financial information underlying a business or transaction to help stakeholders understand historical performance, earnings quality, working capital, debt, cash flows and other relevant financial matters.

Accounting support can help organise and analyse the underlying records and schedules, but the scope, procedures and conclusions depend on the transaction, available data and intended use of the work.

What We Can Support

  • Historical financial statement and trial-balance review
  • General-ledger and account-level analysis
  • Revenue and expense trend analysis
  • Customer and product/channel analysis where data supports it
  • Working-capital analysis
  • Accounts receivable and payable review
  • Inventory and related balance review
  • Cash and bank reconciliation review
  • Debt and financing schedule review
  • Related-party balance identification
  • Exceptional or unusual transaction identification
  • EBITDA or operating-profit analysis support
  • Management-adjusted figures analysis support
  • Cash-flow analysis
  • Financial data-room schedule preparation
  • Transaction-focused financial MIS and supporting schedules

Typical Due Diligence Questions

Depending on the engagement, analysis may address:

  • How has revenue changed over the historical period?
  • What are the major drivers of operating profit?
  • Are there unusual or non-recurring transactions?
  • How do receivables and payables move relative to business activity?
  • What working-capital items require attention?
  • What debt, financing or other obligations appear in the records?
  • Do management reports reconcile with financial statements?
  • Are there material accounting or classification inconsistencies requiring investigation?
  • Which financial data points require additional supporting documents?
  • What historical trends or assumptions should management explain?

Potential Deliverables

Depending on scope, deliverables may include:

  • Historical financial analysis
  • Trial-balance review schedules
  • Revenue analysis
  • Cost and expense analysis
  • Working-capital schedules
  • Net debt or debt-support schedules
  • Cash-flow analysis
  • Receivables/payables analysis
  • Quality-of-earnings support schedules
  • Normalisation-adjustment support
  • Financial data-room schedules
  • Reconciliation schedules
  • Issue and information-request tracker
  • Management discussion pack

The exact deliverable should be agreed before work begins.

Buy-Side and Sell-Side Support

Buy-side

Support can help an acquiring party organise and analyse financial information provided by the target. The work does not replace legal, tax, commercial, technical or other specialist diligence.

Sell-side

Support can help a business prepare historical financial schedules, reconcile management information and organise financial data before sharing information with potential buyers or investors.

Lender or strategic review

Financial schedules can also be prepared for selected lender or strategic reviews where the required data and scope are defined.

Important Scope Boundaries

Financial due diligence is not automatically an audit or an independent assurance engagement. A due-diligence review does not by itself provide a statutory audit opinion, tax opinion, valuation opinion, legal opinion or guarantee that all risks have been identified.

Quality-of-earnings analysis and financial normalisation depend on transaction facts, accounting policies, management explanations and supporting evidence. Any adjustment is clearly identified as an analysis or proposed adjustment rather than presented as an independently verified fact, unless the engagement specifically supports that conclusion.

Valuation, legal documentation, tax structuring, commercial diligence and technical diligence should be separately scoped with the relevant specialists.

Common Situations

  • A buyer is reviewing a target before an acquisition
  • A founder is preparing for a potential transaction
  • Investors request organised historical financial schedules
  • Management accounts need reconciliation before a transaction
  • Working-capital and debt schedules need structured analysis
  • Historical financial information is spread across accounting systems and spreadsheets
  • Management adjustments require supporting schedules
  • A transaction data room needs consistent financial documentation

Where the group has several companies, see Multi-Entity Accounting; where receivables and payables need ongoing attention, see Accounts Receivable & Payable Management.

Pricing

Financial due diligence is quoted on scope rather than a generic accounting-package price. Relevant factors include:

  • Number of entities
  • Historical period under review
  • Transaction size and complexity
  • Volume of financial data
  • Number of business units or locations
  • Working-capital and debt complexity
  • Depth of analysis required
  • Data-room requirements
  • Reporting deadlines
  • Number of management or transaction-team discussions

Transparent 3-tier pricing

Pick the speed and depth that matches your need. Same quality, same CA team — only the timeline changes.

Data Room

Custom quote

Timeline: Quoted on entities, periods and data volume

Historical financial statement and trial-balance schedules
Reconciliation of management information to financial statements
Financial data-room schedule preparation
Issue and information-request tracker
Working-capital and debt analysis
Quality-of-earnings support schedules
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Financial Review

Custom quote

Timeline: Quoted on historical period and depth of analysis

General-ledger and account-level analysis
Revenue and expense trend analysis
Working-capital, receivables and payables review
Cash, bank and debt schedule review
Related-party and unusual transaction identification
Management discussion pack
Quality-of-earnings and normalisation support

Deal Support

Custom quote

Timeline: Quoted on transaction size, entities and deadlines

Everything in Financial Review
EBITDA / operating-profit analysis support
Quality-of-earnings support schedules
Management-adjustment and normalisation support
Net debt and cash-flow analysis
Multiple entities, units or locations

Every price above is a professional fee, excluding GST and government charges. 50% on delivery.

Due diligence accounting support is customised to the transaction scope, historical period and financial complexity. The quote depends on the number of entities, historical period under review, transaction size and complexity, volume of financial data, business units or locations, working-capital and debt complexity, depth of analysis, data-room requirements, reporting deadlines and the number of management or transaction-team discussions.

How it works

Step 1

Define scope and objective

Identify the transaction or review purpose, periods, entities and financial questions.

Step 2

Data request and organisation

Establish the required financial records and supporting schedules.

Step 3

Historical financial analysis

Review trial balances, financial statements and key account movements.

Step 4

Reconciliation and investigation

Analyse significant balances, unusual movements and selected reconciliations.

Step 5

Working-capital and cash review

Assess relevant receivables, payables, inventory, cash and debt schedules.

Step 6

Management adjustments review

Examine proposed normalisations or adjustments against available supporting evidence.

Step 7

Findings and schedules

Prepare agreed schedules, observations and supporting analysis.

Step 8

Management discussion

Explain key findings, open questions and data limitations within the agreed scope.

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Documents required

Historical financial statements
Trial balances
General ledger
Chart of accounts
Bank statements
Accounts receivable ageing
Accounts payable ageing
Inventory reports
Revenue/customer/product reports
Payroll summaries
Debt and financing schedules
Fixed-asset schedules
Related-party schedules
Tax and statutory accounting reconciliations where relevant
Budgets and management accounts
Major contracts or commercial summaries where relevant
Management-adjustment schedules
Data-room documents and transaction information available to the finance team

Why CorporateWalla®?

Historical financial analysis

Trial balances, financial statements and key account movements are reviewed and set out in structured schedules.

Working capital, debt and cash

Receivables, payables, inventory, cash, bank and financing schedules are analysed for the periods in scope.

Quality-of-earnings support

Proposed normalisations and management adjustments are examined against available evidence and clearly labelled as analysis.

Data-room ready schedules

Financial schedules, reconciliations and an information-request tracker are organised for buyers, investors or lenders.

Frequently asked questions

It is a transaction-focused review of financial information intended to help stakeholders understand historical performance, earnings, working capital, debt, cash flows and other relevant financial matters.

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