A financial due diligence support engagement is primarily to assist the entity under diligence to provide all data, reports and explanations that a diligence agency requests of the management. A typical financial due diligence engagement can be divided into the three stages of project planning, project implementation and project completion.
1. Project planning:
a. Initial preparative work
b. Compiling an investigative plan
c. Risk assessment procedures
2. Implementation - collection stage:
a. Analysis of sustainable operations of the entity
b. Internal Control
c. Financial affairs
d. Taxation affairs
e. Financial forecasts
3. Implementation - investigation stage:
a. Investigation of overall financial data of the entity
b. Investigation of entity's specific financial condition
c. Investigation of any special matters
4. Completion:
a. Reporting of findings
As part of a financial due diligence support engagement, the client's management would be assisted throughout the above process as an extended arm of the management to ensure a successful closure of the diligence by the third party agency.
