The Analysis Of Due Diligence Of OF Company Merging SE Company

With the rapid development of China's market economy and the gradual improvement of capital markets,competition among companies intensified.According to the survival of the fittest market rules,in order to expand their survival and developing space,the phenomenon that disadvantaged companies in the market are merged is more common.With the continuous improvement of M & A theoretical system and institutional environment,mergers and acquisitions are increasingly becoming an important means of enterprise transformation and upgrading,allocation of resources,rapid development.M & A can help M & A enterprises acquire the core resources of the target enterprises,enhance their competitiveness,improve the status of the industry and achieve rapid development,so the acquisition is also more and more favored by the enterprises.But mergers and acquisitions are not always successful,but also accompanied by many risks.Once the M&A failed,it not only is the loss of corporate assets,but also damages the company's reputation.The company's value growth is extremely unfavorable.So how to reduce the risk of mergers and acquisitions to ensure the success of mergers and acquisitions is essential.Due diligence can help M & A companies understand the management system,business status and financial status of the target enterprises,which can effectively reduce the risk of M & A and promote the integration after M & A.It is the key means to ensure the success of M & A.Financial due diligence is a part of due diligence,which can provide services for the successful M & A transactions.This paper focuses on financial due diligence.On the basis of reading the relevant literature,this paper expounds the research background,summarizes its research significance,reviews the relevant research achievements of domestic and foreign scholars,and analyzes the theory of financial due diligence,such as the method,procedure,target and basic theory of financial due diligence.Then,combined with the actual case,the above theory is used to analyze the case of financial due diligence,draw the relevant conclusions and provide suggestions for the mergers and acquisitions decision and integration strategy,so that M & A can really enhance the enterprise value.The purpose of this paper is to apply the theory and practice of the financial due diligence survey,and to study the financial due diligence survey of OF company merging SE company.The main content is to study M & A motivation of SE company,SE company's financial environment,organizational structure,internal control system,and SE company's intrinsic value,profit trends and growth assessment of a comprehensive analysis.In the case study of OF company merging SE company,through financial due diligence investigation,SE company's financial data problem and disclosure of SE,and company's internal control deficiencies is revealed,which reduced the information asymmetry degree of both sides and effectively reduced the risk of OF M's acquisition.By analyzing the company's core competitiveness,profit trends and growth aspects,the value of the SE company was comprehensively assessed.Through the financial due diligence survey,SE company's institutional structure,corporate culture,core competitiveness,business model and so on were more comprehensively understood,which provided the basis for the merging decision of M & A and the integration measures after M & A and help the two sides of the M & A transaction achieve synergies in technology,finance,management and other aspects.Then,the value of the integrated enterprise was maximized,providing great convenience for the integrated design and effective implementation of the M & A program in order to achieve the desired M & A target.Theoretical analysis and practice studies show that in the process of the mergers and acquisitions,the target enterprises have a strong incentive to raise their valuation,to obtain higher returns.Target companies often whitewash financial statements,inflate income,hidden costs and exaggerate company performance to achieve this goal.In the process of mergers and acquisitions,mergers and acquisitions are facing legal risks,and financial risks,operational risks,management risks brought by the target enterprises.By studying the financial due diligence in the process of M & A,it is found that financial due diligence can help to determine the intrinsic value of the target enterprise.It is an important means to reduce the risk of M & A and is an important guarantee to ensure the success of M & A.Financial due diligence can help the acquirer to obtain more information about the financial status and operating conditions of the target company,mitigate the information asymmetry problem,and eliminate the risk of information loss and information error as much as possible.Successful financial due diligence can effectively reveal and reduce the legal risks,operational risks and financial risks of M & A,and lay a good foundation for the successful implementation of M & A.The study shows that when the financial due diligence investigation is carried out,the M & A enterprise can consider choosing the offices as the subject of due diligence.The professional competence of the practitioners of the accounting firms can improve the credibility of the financial due diligence results.Choosing professional institutions such as accounting firms on behalf of the acquirer to carry out the financial due diligence of the target enterprises,has become the main choice of acquirer.