Company due diligence
Even among consultants and experts, the concepts of tax due diligence and company due diligence are often confused. Tax due diligence essentially covers only taxation (and possibly accounting), while company due diligence covers a much broader scope, practically the entire area of operation. Due diligence is generally comprehensive in nature, but it may also cover specific areas (e.g. legal, HR, IT, taxation, labour, etc.). Of course, these areas cannot be viewed in isolation from one another, as an employment contract affects both legal and HR matters. The situation is similar, for example, with a loan agreement, which also relates to several areas (such as finance and law).
During the due diligence process, we therefore conduct not only a tax law review, but also a much broader investigation. Given that this comprehensive review requires a great deal of internal and external resources, it is usually conducted as a red flag review, i.e. contracts, invoices and other documentation are reviewed on the basis of materiality thresholds.
When is a company audit important?
In the case of a company acquisition, the aim is to identify the risks inherent in the activities of the company to be acquired that affect the value of the company. The risks inherent in the contract reduce the value of the company in the same way as inadequate management or an unfavourable loan agreement. Due diligence is also useful in the case of holding structures or corporate group restructuring. This allows parallel processes to be filtered out, risky structures to be identified, and a cost-effective corporate structure to be developed.
Why choose us for your company due diligence?
- Our experts have many years of experience in tax law and accounting.
- Our team is reinforced by colleagues with extensive experience in tax administration.
- Thanks to their experience as tax authorities and tax advisors, our experts have extensive experience in the application of tax law and continuously monitor domestic and EU legal practice.
- Our tax and accounting experts can be supplemented by external legal, IT and other experts, thus providing complex services to our clients.
If you have any further questions on this topic, our experts are available at the contact details below.