We offer an independent business review to secured creditors, investors, trustees and other stakeholders.
External stakeholders are not always close enough to a business to have confidence that their loans or investments are utilised effectively. Using the experience and skills we have gathered over many years we can independently review a business. Our review can be tailored to meet your needs and each review will be agreed with the client upfront including the following:
The Financial Stability of the Business
We will review the company’s historical financial records in order to determine the financial stability of the business. This will include a calculation of financial ratios over a number of periods to track the trend of the business in profitability, and together with our review of projections, consider solvency and liquidity. Our review also includes consideration of the corporate structure and impact of related party assets and liabilities.
Operational Aspects Including Strength of Key Management and Systems
It is important to remember that a business is more than just the numbers. We will review and comment on the appropriateness of systems currently in place and if appropriate make recommendations on improvements plus overview the industry in which the business trades and its relative position in that industry. We will also review the strength of the current management team paying particular attention to succession as appropriate.
The Strength of Contractual Arrangements with the Entity
In many businesses particularly service entities, the value of the business is directly related to the strength of its contractual arrangements with both its suppliers and customers. We will review important contracts and consider and report on the impact of a change in control on the contracts and the consequential impact on the business. We will also review and report on the transferability of any contracts as appropriate.
The Reliability of any Profit and Cash Flow Projections
Once we have gained an understanding of the historical performance of the business and considered the various factors surrounding the business including the industry in which it operates we will then be in a position to analyse and critically review any profit and loss and/or cash flow projections prepared by the business. We are also able to utilise the key financial drivers to test the impact of any changes to those drivers on the business.
The Key Financial Drivers of the Business
In any business it is important to understand the impact of key financial drivers. We review the impact on the business of pricing, sales, cost of goods sold, overheads, accounts receivable days, accounts payable days and inventory and work in progress days.
Required Ongoing Support or If Appropriate Exit Strategies
We will conclude our report with an opinion as to the appropriate level of ongoing support should that be justified or in the alternative the most appropriate exit strategy to be used by the lender or investor.
For more information on independent business reviews, please contact us to arrange an immediate initial interview without obligation.