Business Plans Financial Due Diligence Legal Due Diligence

1. Due Diligence and Business Plans
Presenters:
Maria Nicolaou
Maria Sarantopoulou
3/11/2016

2. • Business Plans
• Financial Due Diligence
• Legal Due Diligence
AgendaAgenda

3. Business PlansBusiness Plans
 A tool for entrepreneurs to thoroughly investigate the
factors that will have a bearing on the success of the
business. This can include a new business venture, or an
addition to an existing business.
 A business plan will be used to enhance the ability of the
entrepreneur to secure financing by providing an
organized overview of the venture for lenders and
investors.
 A tool to be used for trying to predicting the future of
your business

4.  Required for financiers and investors
 Review everything at once
 Monitor Progress
 Attracting Talent
The business plan is a tool which needs to be updated on a
continuous basis as the business idea will evolve, to ensure
that targets are being met or are being re-evaluated as
necessary.

5. Main parts of a Business PlansMain parts of a Business Plans
Areas of a business plan
Cover Page & Table of Contents
Executive Summary
Description of the business
Market research and analysis/Marketing
Management Team
Financial Plan

6. The Cover PageThe Cover Page
The cover page should consist of:
•the name of business;
•the main contact’s name;
•full address details;
•the client’s company logo; and
•reader confidentiality
The next page should be the
contents page

7. Executive SummaryExecutive Summary
The executive summary should summarize the most important part of the
business plan. As such it is important that this is the last part of the business
plan to be written.
Potential investors and financiers will frequently only read this part and as a
result this is one of the most important parts of the business plan.
You should remember to include in the executive summary, amongst other
things, the objectives of the business, its mission statement, and the keys to
success.
The executive summary should not exceed 2 pages.

8. Description of the businessDescription of the business
You should give a concise and fact-based description of the business,
what is does and what it is going to make it unique, competitive and
successful. You should describe any special features which will make
the business attractive to potential customers and identify primary
goals and elaborate on objectives.
 Company Ownership
 Location
 Interior
 Hours of operation
 Products and Services
 Suppliers
 Service
 Manufacturing
 Management

9.  Market Analysis
 Competition
 Pricing
 Sales Tactic
 External Factors
 Advertising & Promotion
 Strategy & Implementation

10. SWOT ANALYSISSWOT ANALYSIS

11. How will finances be managed?
How will the firm be profitable?
How will good cash flow be maintained?
How will funding be raised?
Projected statements
Start up expenses
Seasonality

12. What is Due Diligence?What is Due Diligence?
Due diligence is an investigation of a
business or person prior to signing a
contract, or an act with a certain standard
of care.
It is the evaluation of a business
opportunity
It spans into past, present, and the
predicatable future

13. Confirmation that the business is what it
appears to be
Identify potential 'deal killers' - defects in the
target and avoid bad business transactions
Gain information valuable for valuating assets,
negotiatiating price etc
Verification that the transaction complies with
the criteria of the deal

14. Financial Due Diligence
Legal Due Diligence

15. Financial Due DiligenceFinancial Due Diligence
 Verifying the financial information
 Assess the underlying performance of the
business - are there hidden liabilities - up to date
with taxes?
 Establishing and understanding a target firm’s
actual financial situation in the recent few
years
 Forecasting its future financial situation.

16. Methods of Financial Due DiligenceMethods of Financial Due Diligence
Review
Analytical
Procedures
Interviews

17. Preparation for the
merger/acquisition
Raising the firm's
value

18. Legal Due DiligenceLegal Due Diligence
Legal Due diligence is
-most common in M&A transactions (merger,
acquisition of a company or part of (minority or
majority) the shares, or a division, entering a joint
venture etc)
-equally important as the financial, tax, commercial
and IT due diligence

19. - Investigation: determining the legal status of the
target company (know the company, risks, liabilities,
commitments etc.)
-Analysis: assessing consequences of the acquisition
(impediments, restrictions in the process,
requirements)
-Evaluation: supporting the determination of the value of
the target company
-Final decision : take into consideration the findings and
draft accordingly the closing documentation
Legal Due DiligenceLegal Due Diligence
Why importantWhy important?

20. Security Pre-arrangements
-Signing an NDA
-Preparing a safe physical or virtual Data Room
for the protection of the information and the
company’s data
-Authorized access

21. What to investigate
(indicative examples)
•Corporate status, shareholders, shareholding participations,
corporate structure, Minutes of the BoD and General Assemblies of the
shareholders, classes of shares, preferential rights, dividends paid and to be paid,
Articles of Associations –restriction on the transfer of shares
•Internal Regulations, Code of ethics, Corporate Governance Rules
•Intra group transactions
•Assets (real estate property, cars etc)
•Contracts (NDAs, Material Contracts (like with high amouns, impact on financial
status of the cos, loans, bond loans etc), Insurance Agreements, Standard forms
for sale of services and goods, supply contracts, IPR agreements)
•Securities (shares, bonds, debentures etc)

22. •Intellectual Property (trademarks, patents etc)
•Employment of Personnel (employment contracts, employment of CEO and
other executives, stock option plan, pension plan, bonuses, benefits, unions)
•Licenses required by regulatory framework for the operation of the business
•Legal (administrative, civil or penal) proceedings (with employees, third
parties), estimation of the outcome of the pending cases and impact on the
financial status
•Legal Opinion of the Legal Advisor of the Company
•Certificates frοm the commercial registry, courts, tax authority, social
insurance authorities , regulatory auhorities, written communication with
authorities

23. -Prepare and negotiate agreement taking into account findings of the total
DD
-Authorizations for the signature of the Agreement issued by contracting
parties’ organs
-Date of agreement and date of effectiveness, applicable Law and dispute
resolution procedures
-Representation & Warranties, Liabilities & Indemnities
-Personal Guarantees, letter of bank guarantee, pledges/mortgages in
case the consideration is credited
-Conditions precedent (i.e. permissions by Authorities - Competition,
urban planning city etc)
-Penalty clauses
Closing of the deal

24. A few words about Eurofast
Eurofast is a regional business advisory organisation
employing over 200 people in South East Europe &
East Mediterranean.
Our team of professionals is capable of efficiently
addressing all client needs in one single meeting,
using one single language for all the countries in the
Region.

25. •International Tax
•Mergers & Acquisitions and
Transactional Advisory
•Transfer pricing
•Accounting services
•Financial services
•Outsourced Payroll and Employment
solutions
•Corporate services
•Citizenship & Residency services
•HR administration
•Banking and Financial
services
•Business Restructuring &
Insolvency
•IT specialized services
•Tax Planning & Tax
Compliance
•Real Estate tax
•Shipping Tax
•Energy Tax
•Intellectual property
•Market entry services
Our Services

26. Single point of Contact,
Many Points of View

27. What others think about us

28. Find us online
www.eurofast.eu

29. Questions?Questions?