Page 329 - CA Final Audit Titanium Full Book. (With Cover Pages)

CA Ravi Taori
risks/issues.

(CNO—DD.160) CONTENTS OF A DUE DILIGENCE REPORT
1. Introduction and Background
- Introduction
- Background of Target company
- Brief history of the company
- Objective of due diligence
- Terms of reference and scope of verification
- Executive Summary
2. Operational Overview
- Shareholding pattern
- Assessment of management structure
- Assessment of operating results
- SWOT Analysis
3. Financial Assessment
- Assessment of valuation of assets
- Assessment of financial liabilities
- Assessment of taxation and statutory liabilities
- Assessment of net worth
- Comments on properties, terms of leases, lien, and encumbrances
- Status of charges, liens, mortgages, assets, and properties of the company
- Interlocking investments and financial obligations with group/associates companies
- Amounts receivables subject to litigation, any other likely liability which is not provided for in the books of
account
4. Potential Liabilities and Projections
- Assessment of possible liabilities on account of litigation and legal proceedings against the company
- Comments on future projections
5. Recommendations and Observations
- Suggestions on ways and means including affidavits, indemnities, to be executed to cover unforeseen and
undetected contingent liabilities
- Suggestions on various aspects to be taken care of before and after the proposed merger/acquisition
- Observations on the review

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