Due diligence is an onsite process consisting of inquiry and review to gain greater understanding of current conditions prior to taking action on a proposed transaction. It involves extensive research and consideration of all factors that might impact a decision. Due diligence preceding an acquisition might involve a review of operations and financial conditions that would impact the purchase price.
Due diligence also could be performed to determine whether an entity is credit worthy as a precondition to entering into a large contract. We have extensive experience in performing a wide range of due diligence engagements in a variety of industries. Contact a professional today to learn more.
The Financial Accounting Standards Board (FASB) released Accounting Standards Update (ASU) 2017-01 in order to have more consistent application of accounting principles relating to business and asset acquisitions and disposals. The ASU aims to achieve this by clarifying the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses.