Financial Due Diligence

Q: How is this different from your general due diligence support?

General due diligence support can span a broader review, while financial due diligence is the focused financial specialism - deep analysis of the numbers, earnings quality, and financial risks - for when you specifically need a thorough examination of a target's financials before a deal.

Q: Who needs financial due diligence?

It is valuable for anyone acquiring a business or making a significant investment - strategic buyers, private equity and other investors, and companies pursuing mergers - and also useful for lenders assessing a financing, essentially anyone relying on a target's financials for a major decision.

In-Depth Financial Examination of a Target Before You Invest or Acquire

Before acquiring a business or making a significant investment, you need to look beneath the headline numbers and understand the true financial position and performance of the target. Financial due diligence is a focused, in-depth examination of a target's financials — its quality of earnings, cash flows, assets and liabilities, working capital, debt, and the reliability of its forecasts. It uncovers risks, confirms or challenges the assumptions behind the deal, and gives you the insight to negotiate and decide with confidence.

Our financial due diligence services provide a rigorous, independent examination of a target's financial affairs, highlighting risks, red flags, and negotiating points so you enter the transaction fully informed. This is a focused specialism that complements our broader due diligence support, supports our transaction support services, and connects with our financial consulting for the decisions that follow.

Our Financial Due Diligence Services

Quality of Earnings

Analysing the quality and sustainability of the target's earnings.

Financial Analysis

Reviewing historical financials, trends, and performance.

Working Capital & Debt

Assessing working capital, debt, and debt-like items.

Assets & Liabilities

Examining the reliability of assets and liabilities.

Forecast Review

Testing the assumptions behind the target's projections.

Risks & Red Flags

Identifying financial risks, red flags, and deal issues.

Benefits of Financial Due Diligence

A true picture of the target's financial position and performance
Insight into the quality and sustainability of earnings
Early identification of financial risks and red flags
Stronger negotiating position and informed deal terms
Validation or challenge of the assumptions behind the deal
Greater confidence in your investment or acquisition decision

Frequently Asked Questions

What is financial due diligence?

Financial due diligence is a detailed, independent examination of a target company's financial affairs, carried out before an acquisition or investment. It focuses on the quality of earnings, cash flows, assets and liabilities, working capital, debt, and forecasts, aiming to give the buyer or investor a true understanding of the target's financial position and any risks.

How is this different from your general due diligence support?

Our general due diligence support can span a broader review depending on the engagement. Financial due diligence is the focused financial specialism — deep analysis of the numbers, earnings quality, and financial risks. If you specifically need a thorough examination of a target's financials before a deal, this is the service, and it complements broader diligence work.

What is quality of earnings?

Quality of earnings analysis examines how genuine, sustainable, and repeatable a target's reported profits are — distinguishing core, recurring earnings from one-off, non-operating, or accounting-driven items. It is central to financial due diligence because it reveals the real, ongoing earning power on which a valuation and deal are based.

Who needs financial due diligence?

Financial due diligence is valuable for anyone acquiring a business or making a significant investment — including strategic buyers, private equity and other investors, and companies pursuing mergers. It is also useful for lenders assessing a financing. Essentially, anyone relying on a target's financials to make a major decision benefits from it.

When should financial due diligence be done?

It is typically carried out after initial interest and a preliminary understanding on a deal, but before the transaction is finalised — so that findings can inform the price, terms, and the decision to proceed. Conducting it at the right stage ensures you have the financial insight you need before committing.

Look Before You Leap

Rigorous financial due diligence to understand a target before you invest or acquire.