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 AdvisorsTM. 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.
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