Due diligence in Russia
Financial and Tax Due diligence
Due diligence ensure independent collection of objective information and expert assessment of information about the asset being sold.
Due diligence procedure is aimed at checking the legality of all activities, as well as the commercial attractiveness of a potential transaction or investment object.
The investor or owner receives information at his disposal in such areas as accounting, personnel and tax accounting.
There is a list of situations in which this method of analysis should be carried out as a mandatory initial stage, namely:
- merger or acquisition of a business;
- acquisition of stocks or shares of the company;
- purchase of real estate;
- establishment of new partners;
- provision of borrowed funds;
- targeted financing, in particular sponsorship or gratuitous;
- other financial and commercial transactions in which it is necessary to provide authentic data about the object of the transaction;
- or about the financed company;
- or about the invested project to the investor, sponsor or buyer, etc.
| ACCOUNTING AND TAX CONSULTING | |
|---|---|
| Financial outsourcing (keeping accounting records) | from 300 euro |
| Tax consulting | from 50 euro |
Tax audit (due diligence)
When also organizing a tax audit (due diligence).
This means the process of determining the structure of the tax burden, the completeness/timeliness of tax payment.
Tax audit also includes the study of the legal status of the company.
The chosen method of tax encumbrance and company’s calculations with the budget.
As a result, this allows you to evaluate past periods by the amount of tax funds paid, the current state, the chosen method of taxation.
Based on this and taking into account possible changes in the legislation, preliminary conclusions are made for future periods.
Tax audit key points:
- compliance of the volume/amount of taxes with the legislation;
- tax risks (taking into account possible and planned changes in legislation);
- transactions between affiliated persons;
- the structure of the company/object of taxation
In addition, in agreement with the customer, specialists assess whether it is possible (and to what level) to optimize taxation.
As a result this is beneficial when acquiring a company, investing in an object.
The process allows you to evaluate the financial activity of the enterprise.
Take into account errors in taxation, the existing non-payment of any types of taxes.
These issues, as well as tax disputes, affect the solvency and liquidity of the object (company, enterprise).
Tax Audit Procedures
Analysis of the tax aspects of the business / investment object.
Assessment of the existing tax burden.
Calculation of tax charges.
The procedure and volume of settlements with the tax service.
Examination of the compliance of the amounts of accrued / paid taxes with the relevant taxes provided for in this section of the legislation.
Reconciliation of the terms of payment of amounts.
Risk assessment, including salary and extra-budgetary funds.
Assessment of the likelihood of claims being filed by any regulatory authorities.
Despite the obvious tax orientation, certainly audit financial liabilities are also taken into account.
In addition to settlements with budgetary / extra-budgetary organizations.
Key points of the tax audit
In addition to the financial and marketing components, which give an accurate reflection of the objects, the legal registration of the enterprise/object also plays a certain role.
As a result, it is carried out:
- verification of the legal status of the company, contractors, the legality of their work;
- assessment of the consequences of possible restructuring, reorganization – for legal entities-for taxation;
- the timing of on-site inspections, the measures of state bodies, since the reorganization gives all the grounds for these actions;
- checking the design and volume of primary documents, because they are the ones that confirm the costs;
- the validity of the existing or planned in the future structure of the enterprise/object, taking into account the tax burden.
The task of the tax audit is to prepare for the audits of the tax service. The purpose of Due Diligence is to determine the degree of correctness of calculations with government agencies.
Due Diligence allows you to assess the degree of tax burden, the validity of benefits, existing preferences.
As a result, the object of the study will be the legality of tax schemes applied at the enterprise or for this object.
Specialists responsible for reporting on the tax audit procedure are guided by the content of transactions, taking into account their form to a lesser extent.
Which allows you to quickly identify possible claims from the tax authorities.
Financial due diligence
This is a verification of the reliability of information about the financial condition of the company.
the results of its economic activities, an assessment of its commercial prospects.
In the course of conducting the financial Due Diligence service,
we determine the key indicators of the company’s financial efficiency, assess future prospects.
Subject to compliance with certain norms and the existing market conditions.
During the financial Due Diligence, certainly we analyze the company’s income and expenses, after that their structure.
Also the presence of debts and assets, obligations, loans.
As a result, we check the quality of accounting, the relevance and reliability of the operations performed to reflect the facts of the company’s economic life.
We consider and analyze the dynamics of growth (or decline) of the main indicators, evaluate the quality of the work of accounting and financial services, accounting systems and reporting.
The quality and correctness of the formation of reporting indicators directly depends on the quality control and reliable reflection of primary documents.
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