Due-Diligence-Assessment with Private Credit Tool.xlsx

	B	C	D	F	H
1	[Company Name]
2	Due Diligence Assessment Model: Scorecard
3	[Date]
4
6	Rating summary
7	Financial performance	0.6
8	Brand value	1.4
9	Business condition	0.2857142857
10	Prospects for the future	0.1428571429
11	Customers	1
12	Competitive environment	0.8
13	Human capital	0.5555555556
14	Quality of assets	1.5
15	Structure of purchase transaction	1.25
16	Private Credit Due diligence	0.09302325581
17	Total	7.62715024
18	Gray cells will be calculated for you. You do not need to enter anything in them.
19	Note: The current due diligence ratings use a scale of 5 as highest and 1 as lowest. You can change the scale to another one, but make sure that it runs lowest to highest down the list data column.
25	Financial performance				List data:
26	Due diligence item		Due diligence response	Rating	Rating
27	What is the current year profit (loss)?		The company reported GAAP net income of $20,100 with EBITDA of $28,000. Based on revenue levels, these figures are acceptable.	3	1
28	What is the previous year profit (loss)?			2	2
29	What is the current year revenue?			4	3
30	What is the previous year revenue?				4
31	What is the current year gross margin?				5
32	What is the previous year gross margin?
33	What is the 3-year revenue growth trend?
34	What is the industry average growth trend?
35	What is the revenue breakdown by product / services category, country and distribution channel?
36	What is gross margins by products /services?
37	Where is the most potential for growth? The greatest risk?
38	What is the profitability and margin comparison versus the industry?
39	Wht is the key assumptions for projected sales and operating cost by segment product?
40	Discuss the Company’s relationship with its current accountants as well as any significant findings in prior years audits ?
41	Does the company have pricing power? Why or why not?
42
43	Brand value
44	Due diligence item		Due diligence response	Rating
45	Can the brand be leveraged to enter new markets or to resist economic downturns?			4
46	Are there there intellectual property rights (e.g. Trademarks etc.) for the domain names and product names?
47	Provide an overview of the Company’s marketing efforts?			3
48	Are a formal custodianship and an organization established to protect the brand?
49	Can the brand be marketed globally?
50
51	Business condition
52	Due diligence item		Due diligence response	Rating
53	What is the current cost of entry into the industry? Is this cost rising or falling, and why?			2
54	Does the need for expensive fixed assets or other large capital expenditures limit our ability to compete?
55	Are inventory and equipment a large part of value?
56	If the business is service oriented, can it hold on to key talent? Why or why not?
57	What does the Company perceive to be the major opportunities and threats for its business? Is this consistent with competitors’ views?
58	Describe hat the Company considers to be its key strength and weaknesses? How does it address its weaknesses?
59	Is there a strong culture?
60
61	Prospects for the future
62	Due diligence item		Due diligence response	Rating
63	What is the industry outlook?			1
64	Are the products or services differentiating enough?
65	Will the products or services soon be outmoded?
66	Has the company grown organically or by acquisitions historically? Can you continue with this growth strategy and can you do it better?
67	If applicable, is the research and development program adequately funded?
68	Is international competition emerging, or is it a current factor within the industry?
69	What is the company's reliance on the overall economic conditions?
70
71	Customers
72	Due diligence item		Due diligence response	Rating
73	Describe the Company’s customer contracts? Average size, after sales and service contracts characteristics, etc.			1
74	Describe revenue per customer, how dependent is the company on few customers?			1
75	Has the company experienced a significant change in turnover among its important customers in recent years?			1
76	Is the company good at acquiring new customers?			1
77
78	Competitive environment
79	Due diligence item		Due diligence response	Rating
80	How many direct and indirect competitors are there?			4
81	What is the company's relative standing against its direct competition?
82	What is the company's strategy versus its competition?
83	Provide a detailed description of the Company’s key competitive advantages versus existing and emerging competitors?
84	Are there specific costs, processes, or technologies that limit competitive entry into the market?
85
86	Human capital
87	Due diligence item		Due diligence response	Rating
88	Do the company's products or services require special skills, education, or licensing?			3
89	Is the work desirable within the job community?
90	Are the environment and the culture considered suitable to the job community?			2
91	How does the compensation rank versus industry averages?
92	Are there a clear division of responsibilities between the senoir management and the Board of Directors?
93	Are there a clear organization structure chart in the company which all staff are aware of?
94	Do all staff have a role description including main responsibilities, tasks and goals?
95	Is there a human resources strategy that promotes employee development?
96	Are basic human resource compliance requirements met? If not, do the exceptions pose material legal risk?
97
98	Quality of assets
99	Due diligence item		Due diligence response	Rating
100	Real estate: Are the location and the facilities suitable for the business?			3
101	Machinery and equipment: What are the costs for repairs? What are the costs for deferred purchases? What are the costs for new investments short term?
102
103	Structure of purchase transaction
104	Due diligence item		Due diligence response	Rating
105	Will the purchase of the company be highly leveraged?			5
106	What liabilities need to be assumed?