M&A diligence was an approach where lawyers would go through piles of documents to evaluate the performance and operations of the seller. While there’s still a lot of work to be completed in the process of diligence, modern technology allows lawyers and other dealmakers to perform their analyses at rates and efficiency that were unattainable until the present.
Tech Due Diligence
In this day and age of GDPR regulations and cybersecurity threats, performing tech due diligence is vital for the health of a business. A thorough tech due diligence procedure involves evaluating a software business’s security and ensuring that they’re conforming to GDPR regulations. It also involves analyzing the quality and scope of the company’s intellectual property, as well as identifying any potential problems.
During the acquisition process it is essential to be aware of the financial structure of a company and make sure that all parties are in agreement on expectations. A thorough due diligence exercise can reveal concerns like overstated net operating losses, not reported tax liabilities, non-filing exposures, tax on payroll as well as sales and use tax and property taxes.
During the due diligence process, it’s vital to have a clear plan to collect and share all the necessary information. The use of playbooks that can be used by teams throughout the process can help to ensure that everyone is on the same page, and also ensures uniformity. Loopio’s team workspaces and collaboration features help teams concentrate on their responsibilities, and prevent them from getting distracted by other tasks.