Financial due diligence is buyer-side review of the target’s historical and projected financial performance, focused on validating the EBITDA figure on which the deal is priced. It typically includes detailed analysis of revenue quality, customer concentration, gross margin trends, working capital, capital expenditure, debt-like items, and EBITDA add-backs.
The scope and cost depend on the business, records available and questions to be investigated. Obtain a proposal identifying the work, deliverables, assumptions and fee.