O'Reilly logo

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

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

155, 168
Revenues by Distribution Channel - Direct Sales to
Consumers (Form 9-07), 155, 169
Revenues by Distribution Channel - Direct Sales to
Government (Form 9-08), 155, 170
Revenues by Distribution Channel - Direct Sales to
Industry (Form 9-08), 155, 170
Revenues by Distribution Channel - Direct Sales to
Retailers (Form 9-07), 155, 169
Revenues by Distribution Channel - Other
(Form 9-10), 155, 172
Revenues by Distribution Channel - Sales Through
Distributors (Form 9-09), 155, 171
Revenues by Distribution Channel - Sales Through
Wholesale Offices (Form 9-09), 155, 171
Revenues by Distribution Channel - Through Sales
Representatives (Form 9-10), 155, 172
distributors
independent, 158, 183
sales through, 155, 171
distributorships, 735
dividend payments, 55
dividend payout, 53, 55
dividend yield, 53, 55
domestic facilities, 543, 547
domestic firms, revenue by geographic region for, 155
domestic marketing locations, 199, 219
due diligence checklists
industry-specific, 709–726
for franchising companies, 711–714
for hospitals and health care facilities, 714–719
for outsourcing of technological services, 721–724
for private equity and hedge fund investments,
724–725
for restaurants, 709–711
for technology-driven companies, 719–721
for special situations, 771–789
Employee Benefit Plans and ERISA Matters
(Form 36-01), 771–775
Environmental Matters (Form 36-03), 779–782
Hart-Scott-Rodino Questionnaire (Form 36-02),
776–778
Real Estate and REIT Matters (Form 36-04),
783–789
transaction-specific, 729–735
for dealerships and distributorships, 735
for joint ventures and strategic alliances, 729–732
for technology licensing arrangements, 733–734
due diligence process, 3–13
art and science of, 5–6
buyer mistakes in, 7–8
definition of, 3–4
disclosure requirements in, 8–11
investigative approach for, 19–20
as necessity, 6–7
problems and exposure areas for, 7
and Sarbanes-Oxley Act, 8, 11–13
early redemption premium, 572
early termination, 111–112, 128
earnings, retained, 683, 695
EDI (electronic data interchange), 720
Effective Tax Rate (Form 25-02), 615, 618
efficiency ratios, 641,
see also
activity ratios
80%/20% rule, 154
electronic data interchange (EDI), 720
Elements of Deferred Taxes (Form 25-02), 615, 618
e-mail, in technology-driven companies, 720
emergency planning, 782
employee benefits
Benefit Plans for Active Personnel (Form 19-06),
508, 518
Employee Benefit Plans and ERISA Matters
(Form 36-01), 771–775
as noncurrent liabilities, 573
and payroll related expenses, 599
Retirement Benefits - Other Than Pension Plans
(Form 19-08), 508, 520–521
Retirement Benefits - Pension Plans (Form 19-07),
508, 519
Employee Retirement Income Security Act of 1974
(ERISA), 771–775
employee stock plans (ESOPs), 771
Employment Contracts (Form 19-12), 510, 525
Enron, 8
enterprise resource planning (ERP) system, 720
entity, 13
Background Information on Entity (Form 3-01),
23, 25–26
Financial Summary (Form 3-02), 23, 27
Environmental Matters (Form 36-03), 779–782
equipment
Allocation of Office Occupancy and Office Equipment
and Furniture Expenses (Form 24-09), 599, 609
for physical distribution
Accounting Policies with Respect to Major
Equipment Items (Forms 13-09 & 14-07),
366–367, 380
DUE DILIGENCE HANDBOOK Index-07
805
Index-08 DUE DILIGENCE HANDBOOK
Major Distribution Equipment (Form 14-06),
366–367, 379
Trend in Distribution Equipment Acquisitions
(Form 14-07), 366–367, 380
for production
Accounting Policies with Respect to Major
Equipment Items (Forms 13-09 & 14-07), 314,
334
Future Production Equipment Requirements
(Form 13-07), 314, 332
Production Equipment (Form 13-06), 314, 331
Surplus Production Equipment (Form 13-08),
314, 333
Trend in Production Equipment Acquisitions
(Form 13-09), 314, 334
Projection of Property, Plant and Equipment
(Form 31-02), 681, 687–688
for restaurants, 710
ERISA (Employee Retirement Income Security Act of
1974), 771–775
ERP (enterprise resource planning) system, 720
ESOPs (employee stock plans), 771
Estimated Personnel Relocation Expenses
(Form 19-24), 540
estoppel certificates, 783
ethics breaches, 12
executive compensation, 775
Executive Summary, 23
existing facilities, 544, 553, 554
expense accounts, 198, 218
expenses (expenditures)
on balance sheets
Projection of Unearned Revenues and Accrued
Expenses (Form 31-06), 682, 692
Trend in Accrued Expenses (Form 22-06),
568–569, 580
Trend in Unearned Revenues (Form 22-06),
568–569, 580
development
Accounting for Development Expenditures
(Form 8-18), 116, 140
Comparison of Development Expenses with Other
Companies (Form 8-15), 115, 137
Current Development Budget Considerations
(Form 8-16), 115, 138
Schedule of Expenditures for Approved
Development Projects (Form 8-10), 112, 131
Trend in Development Expenditures, Salaries, and
Staffing Levels (Form 8-14), 114, 136
general and administrative
Comparison of General and Administrative
Expenses as Percent of Net Revenues
(Form 24-08), 598, 608
General and Administration Expenses
(Form 24-05), 598, 605
General and Administration Expenses as Percent
of Net Revenues (Form 24-06), 598, 606
industry standards for, 598, 608
Projection of General and Administrative Expenses
(Form 30-04), 661–662, 668
Projection of Selling, General and Administrative
Expenses (Form 30-05), 662, 669
Variation in General and Administrative Expense
with Net Revenues (Form 24-07), 598, 607
for human resources
Estimated Personnel Relocation Expenses
(Form 19-24), 540
Potential Cost of Integrating Human Resources
Policies (Form 19-23), 539
Trend in Human Resources Department Expenses
(Form 19-04), 507, 516
in income statement projections
Basis for Projections of Unusual, Infrequent and
Extraordinary Items (Form 30-10), 662, 674
Projection of Other Income and Expenses
(Form 30-07), 662, 671
Projection of Unusual, Infrequent and
Extraordinary Items (Form 30-09), 662, 673
Projection of Unusual and Infrequent Items
(Form 30-08), 662, 672
relocation
Estimated Personnel Relocation Expenses
(Form 19-24), 540
Reimbursement for Relocation Expenses
(Form 19-11), 509–510, 524
selling
industry standards for, 597, 604
Projection of Selling, General and Administrative
Expenses (Form 30-05), 662, 669
Projection of Selling Expenses (Form 30-03),
661, 667
Selling Expenses (Form 24-01), 595, 601
Selling Expenses as Percent of Net Revenues
(Form 24-02), 595, 602
Variation in Selling Expense with Net Revenues
(Form 24-03), 595–597, 603
Trend in Computer, Communications and Information
Systems Expense (Form 15-14), 394, 412
806

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required