A due diligence audit is a comprehensive assessment of an organization’s financial health and overall performance. It provides insights into the company’s competencies, target market, potential customers, and profitability. Due diligence audits are particularly crucial during mergers and acquisitions, as they help in decision-making by highlighting risks and opportunities. While these audits can sometimes be legally required, they are often conducted voluntarily.

Types of Due Diligence Audits:

1. Financial Due Diligence:
   Financial due diligence involves the review of transaction data, historical trade results, cash flow, and balance sheets to validate financial statements. It assesses the financial risks and future funding requirements of the business.

2. Commercial Due Diligence:
   This audit focuses on analyzing various commercial factors, including competitor analysis, target market research, product reviews, and customer feedback, providing valuable insights for potential acquirers.

3. Operational Due Diligence:
   Operational due diligence examines non-financial aspects such as business operations, organizational structure, internal processes, and management performance. It offers a deeper understanding of a company’s overall efficiency.

4. Legal Due Diligence:
   Legal due diligence identifies potential legal risks, such as disputes with regulatory bodies, competitors, or employees. It ensures that all legal aspects are thoroughly evaluated before making business decisions.

At AARMAK, we offer comprehensive due diligence audit services to guide you through mergers and acquisitions in the UAE, ensuring that all risks and opportunities are properly assessed to prevent post-transaction complications.