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The AMA Handbook of Due Diligence by Andrew J. Sherman, William M. Crilly

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15-02 DUE DILIGENCE HANDBOOK
392
Use Of Outside Computer
Services - Form 15-05 (Continued)
Planned Implementation Of New
Applications - Form 15-06
This form will list the new computer applications the entity plans to implement in the near future.
Computer
Inventory - Form 15-07
Form 15-07 provides for the listing of the entity’s inventory of computer equipment, including surplus items.
Communications Applications - Form 15-08
The availability of various communication services at a given locale will impact both the type of services utilized
and the selection of vendor. Consequently, separate forms may be required for each of the entity’s locations.
WHAT TO LOOK FOR
Is the majority of the computer inventory state-of-the-art, or are the majority of the units
out-of-production?
Does the inventory consist primarily of equipment with a common operating system, or is there
a significant inventory of equipment utilizing a different operating system?
Approximately what percent of the units are readily upgradable to the latest chip designs?
In a potential merger situation:
Is the entity’s equipment reasonably compatible with that of the prospective buyer?
Will the prospective buyer have a use for some of the entity’s surplus units?
WHAT TO LOOK FOR
In a potential merger situation - can the development work associated with these new applica-
tions be avoided by utilizing existing programs of the prospective buyer?
WHAT TO LOOK FOR
Is it cost-effective to bring some or all of this work in-house, or is it more cost-effective to
transfer additional work to outside service organizations?
In a potential merger situation:
Does the potential buyer have the facilities to perform some or all of these services at
lower cost?
Does the entity have the facilities to perform services for the prospective buyer?

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