Forensics & Due Diligence
We perform detailed forensics and due diligence engagements, including detailed reports and reviews from our on-site audits. Below is a sampling of the various analysis and procedures Bailey, Elizondo & Brinkman perform during these engagements.
Due Diligence Procedures
- Historical financials review
- Review of financial projections and operating plan
- Review of public information (financial and non-financial)
- Management meeting – discussions with management, key employees
- Vendor and customer diligence – review contracts, terms and sourcing
- Review of material financial contracts (internal/external)
- Background checks
- Industry research, market comps, competitor analysis, product fit
- Enterprise and asset valuation
- Field exam and collateral audits
- Labor and union evaluation
- Technology risk
- Product liability risk
- Government and regulatory risk
- Quality, experience and relevance of management
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Quantitative Analysis
- Historical financials review
- Industry analytics, ratios, key metrics (e.g., DSO, ROIC, EPS)
- Market share
- Cash flow modeling
- Debt capacity analysis, discounted cash flow (DCF) analysis
- Peer analysis
- Top 25 customer review
- Concentration analysis
- Sole source/vendor analysis
- Acquisition and integration history, including core vs. proforma
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Financial Analysis
- Income and cash flow statement analysis, including margins
- Balance sheet analysis, including working capital
- Free cash flow and cash burn analysis, including CAPEX (maintenance and growth)
- Financial ratio analysis – comps
- Financial projections – management and underwriting (expected) and downside cases
- Liquidity analysis
- Asset coverage and liquidation analysis
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