Jen: This is the PKF Texas Entrepreneurs Playbook, I’m Jen Lemanski and I’m back once again with Kimberly Wood an Audit Senior Manager and one of our Approachable Advisors^TM. Kimberly, welcome back, glad to have you here.

Kimberly: Thanks for having me.

Jen: So, we’ve talked in the past about due diligence buy-side sell-side. So, if a firm is keeping to gap, what’s the benefit to the buyer of having those types of audited financial statements?

Kimberly: Audits generally bring credibility, but they’re not as granular. So, for example, with due diligence procedures, we’re going to dive into customer concentrations, trends, seasonality business versus non-business expenses. It’s essentially a deeper dive into the analysis of financial statements. Also, audits are as of a point of time and potential buyers are going to want to get those figures trued up.

Jen: So, are there questions that a buyer should ask you to look into when they are potentially looking at buying a business or do you make recommendations of things that they should touch on?

Kimberly: We have our set procedures to do for due diligence but then also potential buyers will say, hey, I want to take a deep dive into this. Are there customer concentration issues? Hey, we noticed this was skewed a little bit, can you take a look and see what’s causing that? So, definitely we have your basic procedures, but we can tailor it as well.

Jen: Perfect. Sounds good. Well we’ll get you to talk a little bit more about buy-side and sell-side due diligence as well as transactions and those kind of things. Sound good?

Kimberly: Sounds good. Thanks.

Jen: This has been another thought leadership production brought to you by the PKF Texas – The Entrepreneurs Playbook. For more information about this and other topics, visit www.pkftexas.com. Tune in next week for another chapter.