The expression “Due Diligence” originates from the 1933 Securities Act of the United States. In the recent decades, Due Diligence had a “great career”, and today it means a comprehensive examination concerning several areas, including, among others, the assessment and analysis of potential security and other risks resulting from the operation, the management and ownership background of the given company, for the sake of improving the management/investment strategic decision making.
Taking into account the versatile business objectives, the screening – general or detailed – is always planned and performed according to the individual and special requests of our client. Screening provides efficient and objective assistance in the case of controlling new business partners, investments or acquisition.
Generally, but not exclusively, screening consists of obtaining and analyzing the following data and information:
- Checking the person in the official name and address register
- Verification of corporate registration information (including shareholding ratios and directors; include name of registry checked);
- Confirm ownership structure (is there a parent company, or subsidiaries);
- Verification of address and telephone for company (indicate how confirmed (site visit, verification through registry, phone call etc.);
- Business affiliations (shareholdings, directorships) for company and principal; include how confirmed; what source;
- Verification of address, telephone number and identifiers for principal;
- Local media and Internet checks
In addition to which, a detailed screening also includes:
- Regulatory Agency checks on company and principals (research licensing or regulatory body for industry of the target Company, Chambers of Commerce, Associations, Attorney General, Tax Agency
- Confirm any government or political affiliations for the company and principal (including shareholding by state entities).
- Character and Reputation checks on Subject Company and principal Expanded financial information on corporate (Net sales revenues, Operating result, Profit before tax, Balance sheet profit/loss, Profit after tax, Financial instruments, Current assets, Accruals, Shareholders’ equity, Provisions, Liabilities, Deferrals) at least the past 3 years
- Property ownership of subject company address and principal’s residence;
- Results of creditability and security assessment
- Data relating to its movable and immovable assets
- Data relating to other security risks
- Other information determining and affecting the operation of the company
- Comprehensive media search.
- Site visits and field investigations
The results of the screening, by supplementing the statements of other experts, may assist in making the right decisions.