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Financial & Accounting Diligence

Providing tailored, industry-based financial and accounting diligence and advice through a market lens

Our global team of diligence professionals is made up of former Big Four CPAs and transaction accounting professionals with an average of 15 years of experience working across all our industry verticals. Drawing on Houlihan Lokey’s market leadership in middle-market corporate finance transactions and competitive intelligence, our diligence team provides candid, unbiased, and rigorous support on the accounting and financial matters most impacting deal value. We employ innovative methods and avoid template-driven reporting, helping clients and intermediaries manage the costs and time sensitivities around diligence.

Our Financial & Accounting Diligence services assist financial investors, lenders, corporates, and other advisors in identifying and evaluating key value drivers and risk factors most impacting value. Working through industry-specific approaches, we enable our clients to:

  • Gain an understanding of significant patterns and event impacts in the historical performance
  • Evaluate the quality and sustainability of the reported earnings and free cash flow
  • Analyze the quality and potential realizability of the balance sheet and net assets
  • Understand historical working capital patterns and levels relative to management’s projections, and identify opportunities to improve working capital efficiency while managing post-closing adjustments
  • Identify and evaluate the potential impact of key assumptions and sensitivities  on the achievability of management’s financial and operating forecasts
  • Address key accounting and financial reporting risks to credit and purchase agreement negotiations
  • Assess accounting positions and pro-forma transaction impacts to post-closing reporting (considering the potential buyer’s or seller’s position)
  • Evaluate post-closing purchase price adjustments, purchase accounting, and valuation requirements in post-transaction financial models