The decision to invest in or buy a business will have a permanent impact on the company or fund taking such a pivotal action. While there are significant potential benefits to a capital investment, there are also serious risks and uncertainties that need to be identified. Due to the far-reaching ramifications of such decision-making and the complexity of merger and acquisition (M&A) transactions, it is imperative that the investors be advised by experienced professionals dedicated to the M&A process.
Anchin’s Transaction Advisory Services group approaches financial due diligence and tax structuring with a team of industry-focused professionals experienced in numerous M&A transactions. Experts within our dedicated industry groups have a wealth of intellectual capital to draw upon to give our clients a clear understanding about the target company so that issues are identified and mitigated in a timely fashion. Deep involvement at the partner level sets Anchin apart from other firms, and enables you to reap the benefits of our experts’ years of insight, technical knowledge, and business acumen from working with clients at various stages.
Anchin’s Transaction Advisory Services Group leverages our full suite of accounting, tax, financial, and business advisory services on your behalf to ensure that everything is in place for each step of a deal; this team is supported by a tax department with over 100 professionals and an overall accounting firm with more than 350 employees focused on helping your privately-held business or public company thrive. Whether your needs involve performing financial or tax due diligence, reviewing your accounting and bookkeeping procedures, implementing an effective internal controls system, or preparing all the necessary SEC filing and documentation, you receive senior-level, industry-specific support from a dedicated group of M&A professionals who are able to address any issue that might arise.
With a special focus on middle market transactions, our integrated team of financial and tax transaction specialists takes a multidisciplinary approach drawing from our in-house industry experts. Anchin’s Transaction Advisory specialists maintain experience across a multitude of industries, including, among others:
- Business Services
- Consumer & Industrial Products
- Food & Beverage
- Fashion & Apparel
- Manufacturing & Distribution
- Professional Services
- Public Relations & Advertising
- Transportation & Logistics
We will provide you with clear insight into the target’s historical financial performance, as well as assist in testing the assumptions and sensitivities related to its forecasted and projected results. Anchin’s dedicated industry groups enable our professionals to look beyond the numbers to understand the risks involved with an acquisition.
Our experts tailor the scope of work for each transaction to focus on the key risks and sensitivities that are important to you. While the ultimate scope of work will be based on the target and feedback from our clients, the following steps are typically performed:
- Evaluation of the financial performance and run-rate quality of earnings
- Evaluation of the quality of assets, working capital requirements and indebtedness
- Analyses of operational data utilized by target’s management to run its business in order to gain an in-depth understanding of the drivers of financial performance
- Analyses of key customers and/or products as to performance, trends, concentration, profitability, etc.
- Analyses of profitability of lines of businesses, including price-volume analysis
- Read significant agreements and contracts with customers and vendors and analyze the impact on the business
- Vetting of the company’s budgets and/or projections
- Evaluation of any other information or documents that could impact the financial performance of the target such as employment agreements, leases, contracts, revenue back-log, legal invoices, etc.
- Identify weaknesses within the financial reporting process and provide recommendations on how to improve upon such weaknesses
- Comment on financial and accounting sections within the purchase agreement
Our tax department will determine if the company properly filed its taxes in a timely manner and with the proper jurisdictions. We will also check for substantial discrepancies. Once the taxes are properly accounted for, we will be able to tie potential tax liabilities or benefits into the overall deal structure.
The following steps are typically performed during tax due diligence. These steps will result in the development of the most advantageous tax strategy for the company that you are contemplating acquiring:
- Review of the tax filings and other tax issues relating to the specific business and its operations
- Review of payroll tax filings and compliance and evaluation if additional filing requirements are necessary
- Review of sales tax filings and compliance
- Review of income tax filings and evaluation of tax positions taken as well as other options that may be available for reducing income taxes
- Evaluate if filings may be required in other state or local tax jurisdictions
- Review of prior tax examinations and impact on future operations
- Review of the classification of individuals working for the target as employees or independent contractors
- Other matters that may require additional filings
- Analysis of the various structuring opportunities available given the contemplated acquisition
Anchin’s Transaction Advisory Services Group also addresses the increasingly complex needs of private companies preparing for an initial public offering (IPO) as well as public companies navigating daunting regulatory and business challenges. Our team of seasoned professionals has years of experience working with many small to mid-market companies to guide them through the complex IPO process, assisting them in the transitions necessary to become a publicly listed firm and helping to avoid costly delays, and has been designed to offer you seamless service as you move towards an IPO. This expertise and experience coupled with Anchin’s significant in-house resources enables us to offer a uniquely comprehensive service. Working with you from the initial decision to go public, we craft a roadmap that steers you towards a listing on a public exchange.
Additionally, with independence rules and regulatory requirements strengthened, many companies must now employ multiple firms in the pre- and post-IPO process. Anchin has worked seamlessly with other firms and teams of attorneys to bring the process to fruition, and we offer a suite of services that cannot be provided by your audit firm. Anchin was also one of the first firms in the nation to register with the Public Company Accounting Oversight Board (PCAOB).
Do you require sophisticated financial reporting services in a compressed timeframe due to one of the following scenarios?
- Your company is going public.
- You need assistance in meeting your quarterly and annual financial reporting requirements, now that you are public.
- You require financial statements in contemplation of receiving an equity infusion from a private equity firm or other investor.
- You require financial statements in order to obtain financing for a major acquisition.
- Your bank requires audited financial statements.
Are you facing any of these challenges?
- You don’t have the required financial staff and resources.
- Your accounting department does not have the necessary technical expertise.
- Management is focused on growing the business and on the day-to-day operations and does not have additional time to devote to financial reporting.
- The financial reporting deadline is so immediate that you need substantial additional resources to meet the deadline.
We have a proven track record of providing these technical financial reporting deliverables under tight time constraints.
- Your experienced, dedicated Anchin team can also draw on the substantial resources of our firm, as needed.
- We are a multi-disciplinary firm that can resolve all of your issues under one roof – think of us as an extension of your management team helping you meet the myriad challenges of financial reporting, operational and regulatory requirements.
- A member of BKR International, Anchin’s network of firms can provide additional expertise and support, both nationally and globally, if and when needed.
- We provide seamless scalability of resources and workforce as your business changes.
- Our experienced tax professionals and significant tax practice will address any complex tax matters and planning opportunities that may arise as your company continues to grow.
- Anchin is uniquely distinguished by deep experience, involvement and accessibility at the partner level.
- Our in-house development program, known as Anchin University, ensures that our partners and staff are fully knowledgeable on the latest, cutting-edge accounting, financial reporting, tax and regulatory standards.
- We use the latest technology to ensure that efficiencies are achieved throughout the engagement process.
Public company services include:
- IPO readiness services
- IPO readiness assessment
- Review of accounting and bookkeeping procedures
- Consultation on accounting, financial reporting, and disclosure requirements
- Drafting financial statements, footnotes, and SEC schedules
- Acting as an internal accounting department
- Conversion of S-Corp and LLC structure to C-Corp public structure
- Preparation of pro-forma deferral taxes and provisions required as a C-Corp
- Preparation of historical financial statements, disclosures, and schedules for inclusion in registration statement
- Pre-IPO assessment of internal controls for purpose of meeting SOX requirements
- SEC registration
- Valuation analysis
- Internal control reviews and documentation
- Implementation of control recommendations
- Assistance in drafting Forms 10K, 10Q, AK
- Assistance in meeting quarterly and annual SEC reporting deadlines
- Assistance in drafting "Management’s Discussion and Analysis" (MD&As) in filings
- Due diligence with respect to potential acquisitions
- Preparation of pro-forma financial statements in connection with acquisitions
- Accounting for income taxes, including analysis of uncertain tax positions
- Providing schedules, analysis, trial balances, and support to independent auditors
- Assistance in preparing delinquent filings with the SEC
- Tax accounting consultation services
- Interim CFO services
- Internal controls and Sarbanes-Oxley compliance
Below are some highlights of our recent work: