Meaning and Purpose of Due Diligence

In common parlance 'Due Diligence' means the precaution and steps taken by a person or company before entering into a contract or making an investment. It includes activities like investigation, appraisal and audit of all material facts and documents of potential investments. Due diligence can be undertaken for companies, products and even for prospective buyers or sellers.

The purpose of due diligence is to collect and analyse information available from various sources before entering into major projects or investments. Based on the information collected, the company can perform a SWOT analysis and take informed decisions.

Importance of Due Diligence

In the investment and finance world due diligence has a huge significance and is an indispensable part of decision making. It helps understand the overall financial, legal and compliance aspects of a business and if there are any lapses or defaults existing.

This eventually offer insights for companies planning to enter into partnerships with the audited entity. Similarly, it helps banks and investors decide on private equity and funding decisions.

Steps in Due Diligence

  • Defining of purpose of due diligence
  • Collating information
  • Appraisal and analysing
  • Decision making

Why V Purohit & Associates for Due Diligence In India

Due diligence is a strategic aspect of business. Companies in India often leverage this as a means of selfappraisal before an important partnership or for availing a business loan/ investment.

V. Purohit & Associates has in-depth knowledge and deep-domain expertise in conducting due diligence for businesses. Our experience span across various domains and for various purposes. From M&As to business loans, and private equity to winding-up, we have conducted goal-specific due diligence activities for entities of different sizes and complexities.

Further, we have a thorough understanding of banking requirements, processes, procedures, and best practices. This allows us to prepare your case for exactly what the bankers expect. In addition, we can also do ROC Search for Companies.

Talk to us

If you are looking for Financial Due Diligence or Compliance Due Diligence services in India, feel free to call us. We will be happy to assist you.

We are a new-age financial accounting company, that upholds age-old values and principles of Chartered Accountancy. We offer a fairly-differentiated set of services, tailored to specific business goals and challenges.