We offer cooperation in the following projects:

• due diligence
• enterprises valuation
• IFRS/IAS induction

 

DUE DILIGENCE

FSG Audit realizes due diligence projects in the scope of:

• accounting (review of accounting principles used and their influence on the valuation of assets and liabilities, review of financial statements in terms of the correctness of valuation of assets and liabilities)
• tax law (analysis of legal conditions and risk related e.g. to the entity’s assets, determining tax risks, optimization of tax burden in relation to proprietary transformations)
• finance and market (analysis of financial condition based on historical data, assessment of plans/ financial projections, analysis of the management and organization system; analysis of market position, products, sales structure, distribution channels and price policy).

Due diligence is usually performed along with mergers, acquisitions or purchases of units. Its goal is to collect and analyze all information concerning a particular unit in the scope specified in the contract entered into with the Client. The Client receives a due diligence review report.

Due diligence review is conducted by expert auditors in cooperation with financial advisors, assessors, actuaries, lawyers and sector experts as due diligence review may concern various aspects of a particular unit’s operations.

The scope of a due diligence review depends on the accessibility of information. Therefore the following cases are possible:

• review with limited access to a unit’s documentation which is the matter of transaction (we use “data room”)
• review with complete access to a unit’s documentation which is the matter of transaction.

The main goals of a due diligence review are the following:

• identification of the most important matters, issues and chances which are related to the planned transaction which will enable the client to take the most reasonable and optimal decisions,
• detailed financial, tax and legal analysis which will provide valuable information on the company structure, its operations, cost and income structure,
• understanding of critical factors of a company’s income generation,
• comparison of the client’s assumptions under a model used for company valuation which is the subject matter of transaction with current data,
• providing arguments in the negotiations of sale/ purchase contract conditions,
• checking if strategic reasons behind the planned transaction are still valid.

All the above mentioned goals of a due diligence review prove the necessity of the participation of qualified staff, i.e. people who have the knowledge and experience in finance, accounting, taxes, law, HR and IT.

Enterprises valuation

Except for providing auditing services the law enables expert auditors to deliver services classified as “expert economic and financial opinion”. Value assessment and value assessment opinion are among these services. Typical examples of assessments made by expert auditors include:

• valuation of contributions – of the whole enterprise or its organized parts,
• enterprise value assessment for the purpose of sale transactions,
• determination of fair values in the transaction of merger or division of business units.

These services require an expert knowledge of accounting and auditing. Establishing the value of an operating unit is often based on historical and potential profitability of the unit and cash flow is assessed according to capital preservation requirements, perceived risk and other factors. The key factor is the interpretation of accounting and financial data and this is why expert auditors are asked to do it.

IFRS/IAS induction

Under IFRS/IAS induction consulting services we offer:

• active participation in organising and coordinating the project of IRFS induction,
• comprehensive analysis of the company’s reporting system in order to identify the differences between IFRS and accounting policy of the company and to establish principles and possible solutions in terms of implementing IFRS regulations,
• support in the assessment of differences of the values, particularly in terms of fixed assets and procedures of assets valuation,
• development of financial reports templates and accounting policy documentation according to IFRS, as well as active participation in adjustment of IT systems and organization structure to new reporting requirements,
• IFRS training for employees.