Due Diligence Defined
“Due diligence” is a term that you may hear in a variety of contexts, including legal proceedings, financial transactions, and commercial affairs. Generally speaking, a “due diligence investigation” refers to the research a person should undertake before entering into a transaction with another person or entity. However, the term has more specific applications, depending on the context in which it is used.
Due diligence can be a complex process, which is why hiring a private investigator is often recommended — especially for legal proceedings or complex financial transactions. Here’s what you need to know about due diligence in Scottsdale:
Legal Due Diligence
Legal due diligence is a subset of due diligence, and it refers to the work done between the legal counsel of two companies. When performing legal due diligence, the counsel for each company learns about the counsel for the other company, as well as the company’s internal policies and procedures. This information is used to improve communications between the legal representatives for the two companies, helping to make future interactions go more smoothly.
Financial Due Diligence
Financial due diligence is more common. It refers to the work that a company does before making an investment, such as purchasing another company. This due diligence involves investigating the finances of the other company, such as their profits, losses, overhead expenses, debts, and other obligations. Due diligence will look at the short- and long-term projections for the company’s finances to ensure that the investment is a good one.
Commercial Due Diligence
Commercial due diligence can be the most complicated type of due diligence. It refers to the work that a company does to investigate the operations of another company before entering into a business partnership, merger or other acquisition. Due diligence can include finances, as well as legal issues. The key is to find out everything that you can about the other company to assess its value and its long-term prospects.
If a merger is proposed, due diligence would look at the compatibility of the other company to ensure that the union will be a successful one. Due diligence would also determine what changes would need to be made to join the companies successfully. The due diligence process for commercial transactions is a complex one, and a team of professionals usually work together to get the needed information, including a trained Scottsdale AZ private investigator.
TBL Investigator offers companies in Scottsdale the professional assistance they need for thorough due diligence for a successful transaction. Lead private investigator David Hutchings has years of experience working in law enforcement on complex criminal and civil cases, including identity theft and embezzlement. He can put his experience and training to work for corporations, helping them to get all the information they need to make an informed decision about a potential investment or merger. He will also guide executives to ensure that they are filing all the necessary legal paperwork and are meeting all their legal obligations for the transaction. Call TBL Investigator today to find out how private investigator David Hutchings can help you perform your due diligence research in Scottsdale.
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