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Dealerships Featured Offerings Due Diligence Services Any entity planning an acquisition of an automobile dealership should conduct due diligence as part of that acquisition. The reason it is referred to as “due diligence” is that it is the acquirer’s responsibility to be diligent in the acquisition and make sure that it understands that information being relied upon in the buying and price decisions is accurate. Due diligence can uncover large adjustments to historical financial information, undisclosed liabilities, and other unsuspected weaknesses. All of these can have a significant impact on not only the selling price but the deal itself. Crowe Horwath LLP has a unique set of skills and tools to make the due diligence process extremely efficient and effective. These include financial and accounting experts who have spent the majority of their careers serving automobile dealers; they know and understand the industry and know where to look for the operational, financial, and control issues you need to know about for an acquisition. Most dealers use historical financial statement numbers to arrive at a purchase price. Since our group is dedicated to serving dealers we know the common adjustments that are needed to adjust internally prepared financial statements to a Generally Accepted Accounting Principles (GAAP) basis of accounting. These adjustments can have a major impact on the calculation of a purchase price. And, we have the tools available to make this an efficient and effective process. These include Crowe Dealer eAuditor and eAnalyst, both of which utilize dealership-designed solutions that extract data directly out of the dealer’s Dealer Management System for detailed analysis. The benefits of using Crowe’s due diligence services include:
Our due diligence service typically will encompass a deep dive on both the financial and operational issues surrounding both the balance sheet and the income statement and give you a good idea of historical cash flows. However, the service can be scaled to meet your specific needs and may only include an electronic analysis based on downloaded information (as an example). At the conclusion of our due diligence work, we provide a written report. The report contains a high-level summary and quantification of issues an acquiring company should consider based on the results of our investigation. The report will also contain our financial analysis including adjusted historical financial data. More and more investors depend on Crowe’s objectivity, financial acumen, and industry experience to mitigate risk in their acquisition strategies. For more information, please contact Richard Kotzen at richard.kotzen@crowehorwath.com or 954.489.7430. |
