Acquisition Due Diligence
LCG’s Acquisition Due Diligence analyses provide lenders, buyers, and sellers involved in an M&A transaction with a high degree of insight into the risks, performance, and opportunities associated with the business under review. These analyses assist the parties in developing the optimal deal structure and help to avoid costly mistakes. Acquisition Due Diligence analyses can also be complemented with our other services lines to give additional comfort without having to engage multiple service providers.
In completing more than 150 engagements annually, LCG has a broad base of clients including:
- Private Equity Firms
- Family Offices
- Independent Sponsors
- Mezzanine Funds
- Senior Lenders
- Investment Banks (Sell-Side Prep)
Buy-Side Full Scope Acquisition Due Diligence:
LCG’s professionals have extensive experience performing buy-side acquisition due diligence throughout a variety of different industries. Many of our professionals are CPAs with backgrounds in Big Four audit and transaction advisory services. Furthermore, we primarily work with family/founder owned businesses and have developed a unique approach to working with the business owners with our friendly demeanor and professionalism, protecting the dynamics of the transactions we’re involved in. Our experience, high caliber professionals, and unique approach allow for a more efficient financial diligence process (i.e., average 3-week turnaround time) while still delivering robust and quality analyses.
Buy-Side Focused Diligence:
Flexibility is needed at this end of the market. As such, LCG can perform focused diligence engagements by catering the scope to match the specific needs of a given transaction. This approach allows for more budget flexibility when trying to reduce deal costs as well as improving efficiency and allowing for even quicker turnaround times. Our focused diligence engagements can range from a simple “proof of cash” analysis to a more robust “QoE lite.”
Although most of our engagements are buy-side in nature, we perform a significant number of sell-side engagements annually to help lower-middle market sellers prep for an imminent transaction. We approach a sell-side engagement similar to a buy-side engagement with the same level of scrutiny and integrity in order to better prepare sellers for a buy-side process. Our goal is to walk sellers through the financial diligence process and avoid the surprises and headaches that can come with going through a traditional buy-side process.
Additional Services Upon Request:
We often perform analyses as part of our scope of an Acquisition Due Diligence or Focused Diligence project which includes (but is not limited to):
- Analysis and pro forma adjustments related to potential deferred revenue
- For Companies utilizing the percentage of completion method of recognizing revenue and costs, we evaluate the methodology of management and propose pro forma adjustments as necessary
- Assist client with creating and projecting pro forma working capital and setting target working capital
- Assist with compiling or creating financial projections including balance sheet projections, income statement projection, and cash flow projections
- Perform sampling and testing to gain comfort over source data used in revenue recognition
- General financial accounting consulting to assess financial records and propose correcting journal entries
- Carve out due diligence