Page 13 - Lets Talk Winter 2015 | Lipton Chartered Accountants
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Let’s Talk Winter 2015 www.liptonllp.com
and write-ups or write-downs in the value
of other assets. A company that deals with
foreign exchange in its sales and/or purchases
can have a gain or loss unrelated to its core
business. Related party transactions are area
that requires scrutiny as these transactions
may inflate the sales, reduce costs or not be
available to the purchaser after closing.
The expenses of the target company should be
examined. A summary of several years’ results
can be compiled and then reviewed for patterns
or unusual items. For example, an increase in
professional fees may be an indication of a law
suit against the company. A decrease in margin
may indicate a problem with inventory or an
increase in costs that will affect profitability.
A due diligence investigation is an important
safeguard when considering an acquisition of a
target company’s assets or shares. It will provide
invaluable assistance in making a decision to
buy or not and if the asking price is justified.
This article was originally published in a recent
edition of Lawyers Weekly.
STEvEn PolISUk
Steven Polisuk, CBV, CFE, President – Lipton
Polisuk Inc. is in charge of the valuation and
litigation support practice at Lipton Polisuk Inc.
spolisuk@liptonpolisuk.com
13
Let’s Talk Winter 2015 www.liptonllp.com
and write-ups or write-downs in the value
of other assets. A company that deals with
foreign exchange in its sales and/or purchases
can have a gain or loss unrelated to its core
business. Related party transactions are area
that requires scrutiny as these transactions
may inflate the sales, reduce costs or not be
available to the purchaser after closing.
The expenses of the target company should be
examined. A summary of several years’ results
can be compiled and then reviewed for patterns
or unusual items. For example, an increase in
professional fees may be an indication of a law
suit against the company. A decrease in margin
may indicate a problem with inventory or an
increase in costs that will affect profitability.
A due diligence investigation is an important
safeguard when considering an acquisition of a
target company’s assets or shares. It will provide
invaluable assistance in making a decision to
buy or not and if the asking price is justified.
This article was originally published in a recent
edition of Lawyers Weekly.
STEvEn PolISUk
Steven Polisuk, CBV, CFE, President – Lipton
Polisuk Inc. is in charge of the valuation and
litigation support practice at Lipton Polisuk Inc.
spolisuk@liptonpolisuk.com
13
