Financial due diligence services in Singapore.
Achieve financial due diligence through investigations that ensure that the target company or investment is financially sound and that all material risks have been identified.
Get the assurances
you need in your acquisition.
Thorough investigation
We conduct all the necessary investigations to make sure any risks associated with your target company of investment have been identified.
Clear communication
Our experienced team ensures a clear and effective communication process to ensure that buyers and others are on the same page at the time of a purchase.
Global perspective
Acclime uses its global expertise to make sure all your international compliance and governance needs are protected moving forward.
Financial due diligence services
Providing essential due diligence support.
Most growing businesses will have to consider cross-border transactions, such as setting up a branch or joint venture outside of a home market or acquiring an overseas competitor. Our aim is to provide clients with clear insights into the viability and reliability of potential investments, acquisition, merger or joint venture projects.
We also offer practical solutions to issues identified during the due diligence process that may impact investments in the future, but should be considered during the investment negotiation stage.
Our due diligence services.
Our due diligence is designed to provide confidence in the integrity of all entities through a comprehensive review of the target company’s financial health, governance, and risk profile. Our scope of services includes the following:
- Capitalisation – Evaluate the size and volatility of the company and its market to establish an appropriate valuation baseline.
- Revenue, profit and margin trends – Assess recent trends in financial performance, including whether figures are rising, falling, or stable, and benchmark margins against industry competitors.
- Profitability, financial position and cash flows – Evaluate asset quality, liabilities, financial leverage, and cash flow generation of the target company.
- Accounting policies – Review significant accounting policies adopted and identify any adjustments required to restate financial statements to Singapore Financial Reporting Standards (SFRS) or US Generally Accepted Accounting Principles (GAAP).
- Balance sheet analysis – Analyse the debt-to-equity ratio, assess the realization and recoverability of assets, and search for under-accruals, unrecorded liabilities, and off-balance-sheet transactions.
- Management and ownership – Research the leadership structure, including whether the company is founder-led, and assess governance quality.
- Stock history and options – Review the company’s trading history, stock price stability, and any outstanding stock options or equity arrangements.
- Risks – Identify and assess industry-wide and company-specific risks, including any outstanding legal, regulatory, or operational exposures.
- Expectations – Evaluate forward-looking profit estimates and assess the reasonableness of management projections.
FAQs
Common questions.
Financial due diligence investigates the target company’s financial position to validate the buyer’s understanding before committing to a transaction. Core areas covered include:
- Quality of earnings: assessing whether reported profits are sustainable, recurring and free from one-off items that inflate the headline figure
- Quality of assets: reviewing the carrying value and recoverability of balance sheet assets
- Working capital: establishing the normalised level required to run the business and identifying structural fluctuations
- Net debt and debt-like items: identifying all financial liabilities including contingent obligations and off-balance sheet exposures
- Cash flow: examining the relationship between reported earnings and actual cash generation
- Tax position: reviewing historical filings, open assessments and potential transfer pricing exposure
Findings directly inform valuation and are used to negotiate price adjustments, warranties and indemnities in the sale and purchase agreement.
An audit provides an independent opinion on whether financial statements present a true and fair view under the applicable accounting standards. It is backward-looking, compliance-focused and statutory.
Financial due diligence is transaction-focused. Rather than confirming that accounts comply with standards, it investigates what is driving the numbers — whether earnings are sustainable, assets recoverable, working capital normalised and whether risks exist that are not visible in the audited accounts. Findings are framed around what a buyer should pay and what risks should be reflected in price or contractual protections.
A clean audit opinion does not reduce the need for financial due diligence. Audited accounts can be technically compliant while obscuring earnings volatility, related-party transactions or working capital pressures that are material to a buyer’s investment decision.
Financial due diligence is typically conducted after a non-binding offer or letter of intent has been agreed, but before the sale and purchase agreement is signed. This allows the buyer to confirm the assumptions underlying the indicative offer before committing legally, and ensures findings can be reflected in the final price, deal structure or contractual protections.
In competitive auction processes, buyers may need to submit bids before completing full due diligence. In these situations, a focused review of quality of earnings and net debt is prioritised, with deeper investigation of specific risk areas conducted in parallel with legal negotiation. Where regulatory approval is required, such as MAS approval for financial sector deals, due diligence findings may also inform how the acquisition is structured before the application is filed.
Findings vary by sector and company size, but several issues recur consistently:
- Normalisation adjustments: reported earnings inflated by non-recurring items or above-market related-party transactions
- Working capital shortfalls: working capital presented at an artificially high level due to timing of collections or payables
- Undisclosed liabilities: tax exposures from open assessments, unresolved transfer pricing positions or off-balance sheet obligations
- Revenue recognition: income recognised earlier than the economic substance warrants, particularly in project-based businesses
- Related-party transactions: commercial arrangements with connected parties on non-arm’s length terms that will not survive a change of control
- Cash conversion: a significant gap between reported EBITDA and actual cash generation
Each can affect valuation, deal structure or the buyer’s willingness to proceed on agreed terms.
For mid-sized transactions, financial due diligence typically takes four to eight weeks from the point at which data room access is granted. The timeline depends on the complexity of the target’s financial structure, the quality of information provided, the number of jurisdictions involved and the agreed scope.
Compressed timelines of two to three weeks are common in auction processes, where the scope is prioritised around issues most likely to affect valuation. Cross-border transactions involving multiple entities routinely extend beyond eight weeks. The single biggest cause of delay is incomplete or disorganised financial information from the target.
A well-prepared data room reduces the time and cost of a due diligence exercise and signals to buyers that the business is well-managed. Core documents typically requested include:
- Audited financial statements for the last three financial years
- Management accounts for the current year to date, reconciled to the most recent audited accounts
- Monthly revenue and cost breakdowns for the last two to three years
- A schedule of all related-party transactions and the terms on which they are conducted
- Tax returns and IRAS correspondence for the last three to five years, including any open assessments
- A net debt schedule as at the most recent month end
- Working capital analysis showing monthly movements in receivables, payables and inventory
Engaging an adviser to conduct a pre-sale readiness review before approaching buyers allows issues to be identified and addressed before they become deal risks.
