Due Diligence

contact photo JUDr. Ing. Veronika Škodová

skodova@skodaskoda.sk  •  0910 919 638

SKODA & SKODA provides legal and economic advisory, including specialized service Due Diligence.

This product consists in the elaboration of legal and / or economic audit. The aim of Due Diligence is to assess the economic and legal condition of the company. Due Diligence is used as an excellent indicator of company endurance and is also the basis for company restructuring or investment.

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The principal meaning of making Due Diligence consists in the inccurate information and unequal distribution of information about the company among potential contractual parties, as well as the uncertainty arising from future development in the business. The main purpose of the Due Diligence process is to overcome this information asymmetry. First class and accurate information is important for both parties, not only toassess the economic situation of testing enterprise and economic consequences of proposed transactions, but also for preparation of necessary contracts for transaction, including the determination of guarantees and insurance.

According to the presumed intention, we use Due Diligence in various fields as:

Financial Due Diligence

The basic input for financial Due Diligence is condition of property and its equity as well as the method of financing and results of its management in recent years. The nature is to realize a comprehensive financial analysis, whereby is the data from the financial statements verified in detail. These data are given into economic context and are used in the evaluation, depreciation and reserves creation.
The objective of financial Due Diligence is to identify potential risks caused by the incorrect accounting and values distortion, ​​reported in the balance sheet (such as assets overestimation, underestimation of liabilities and risks, etc.).

Tax Due Diligence

Main purpose is to determinewhether the company properly fulfilled all legal obligations under the public law regulations, and identify potential risks on taxes, which might have a significant impact on the equity of the entire company. Most frequently it is the risks related with income tax and VAT, or other relevant tax. The aim is to identify all tax related risks, arising from possible errors in accounting, tax calculation or unfair practices.

Legal Due Diligence

It is another part of the process of inspections and audit. Emphasis primarily to acquire and consider relevant information about affiliateslabor-law relationsloan or credit relations, and other contractual relationshipsrights and obligations of the third parties, intellectual property rights etc. On the basis of legal due diligence is necessary to determine whether is company threatened with lawsuits or other risks due to lack of legal protection.


Operational due diligence

Is a process whereby the potential buyers assess the effectiveness of operational assets of Target Company, in order to determine or disprove the objectivity of business plan. The potential investor is considering whether it is realistic to expect the declared business results under such conditions and assumptions. The purpose of operational Due Diligence is also to identify potential synergies and risks in the case of merger or acquisition.


Referencie

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SKODA & SKODA s.r.o.
Dolná 6/A
Banská Bystrica 974 01
tel/fax.: +421 48 418 09 76
e-mail: Office@skodaskoda.sk

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