Going beyond quality of earnings

As with most industries, the M&A industry has matured and evolved over the years, where highly complex transactions are no longer exclusive to the behemoth deals but the norm. As transactions have become more complex, service providers to the M&A industry have evolved to keep pace with their clients. At RSM, we pride ourselves on our evolving practice, where we’ve made the investments and employed innovation to meet our clients’ needs.

Due diligence used to simply signify a quality of earnings (QoE) report. But with the sophistication of buyers, sellers and limited partner shareholders and the increased risks in today’s deal making world, the QoE is no longer sufficient. Investors want assurances around their investments as well as a strong understanding of all the various pros and cons of the deal. RSM is able to give our private equity, investment banking and corporate clients that holistic view to help them make the right investment or divestiture decision.

IT and cyber due diligence, data analytics, working capital and debt-like considerations, transaction readiness, staff augmentation and modeling are just some of the services RSM offers today to help buyers and sellers get comfortable with the deal. Additionally, we are proud to be able to offer in-depth industry knowledge and subsector experience—not just accounting insights.

Some of these diligence efforts are newer than others, but all are necessary today. For example, so many companies having employees working remotely and virtually today—especially given the COVID pandemic—and while cyber due diligence is relatively new form of diligence, it is just as important as the QoE. On the IT side, understanding if your systems are antiquated, or if they can scale with your business, is more important than ever. We frequently see legacy IT systems holding businesses back from reaching their full potential.

Whatever the issues may be, RSM will uncover them and provide the services necessary for all parties to transact successfully. That can mean anything from helping the seller with transaction readiness months before a transaction or helping a buyer understand how COVID will impact a particular business on a go forward basis.

RSM’s team of 450 transaction professionals has had the benefit of working on thousands of deals for clients, and over the last five years has worked on almost 2,900 transactions. We understand the deal complexities, the different pressure points and how to make transacting easier for buyers and sellers. We also understand the stakes are high and that it is not just about checking the boxes or delivering reports. It’s about finding ways to resolve our client’s problems and adding value to their investment thesis. We provide end-to-end assistance from pre LOI through post acquisition.

With that in mind, we have partnered with Mergers & Acquisitions to bring reader’s a content hub focused on successfully navigating the due diligence process. On this page you will find videos, articles, and infographics focused on various types of due diligence and their importance. We hope you find this information valuable and we look forward to partnering with you in the future.