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The Issues

due-diligence1It is very often the case that in acquiring a new company the focus is nearly always on opportunity rather than threat. For this reason companies rightly pay detailed attention to the “financials” and return on investment.

 

There are however often pitfalls which do not come to light during the conventional Due Diligence exercise.

 

Information in relation to risk, whether for companies, individual properties or land, in terms of the political climate, exposure to natural catastrophes and public and environmental liability is crucial to balanced decision making. For example a culture in a particular company may be difficult to define yet could have disastrous effects on making a success of a new acquisition

 

Identification and managing of the not so obvious “non financial risks” risk needs to be integral to the Due diligence process to ensure, competitiveness, compliance and management of costs.

Solutions

Risk Management is about “Balanced Decision Making “and our consultant will conduct an Analysis which will provide you with information to apply that Balance.

 

We will work with your financial advisors to provide information in a wide range of areas including but not limited to:

  • Site surveys to determine physical risk profile

 

  • Health and Safety performance past and present ;

 

  • Environmental site profile ( non intrusive but can be arranged through third party)

 

  • Absenteeism

 

  • Adequacy of site control measures for protection of property assets and people;

 

  • Business Interruption exposures

 

  • Check regulatory or insurance requirements.

 Benefits

 Identify previously unknown exposures;

 

  • Provide clear and concise information to aid overall decision making

 

  • Develop first stage risk improvement, plan which can be costed

 

  • Insurance marketing reports to elicit best premium terms for new set up if needed.

 

  • Training for Property Managers, e.g. familiarisation with Health and Fire Life Safety issues.

Our clients can see the benefits on the ground with improved insurance terms, improved compliance, cost management and security.  There are also clear benefits in terms of smoother acquisition and divestiture where comprehensive risk information is available. At a higher level we aim to reduce the uncertainty in taking risks a fundamental to future business development and growth.

 

Our client also owns the information rather than depending on snippets from insurers about their own risk profile.

See sample grading sheet below

 

 

 

GENERAL

SERVICE & UTILITIES

SPECIAL HAZARDS

 

Location

OVERALL GRADING

Location

Construction

Occupancy

Air Con

Electrical

Water

Gas

Chemicals/Flammables

Storage of Combustibles

 

 

5

4

3

4

3

5

 

5

5

 

 

4

5

5

4

4

4

 

1

3

 

 

5

4

3

4

3

5

 

5

4

 

 

4

4

4

5

4

5

 

5

4

 

 

5

5

5

5

5

5

 

3

3

 

 

 

 

 

 

 

 

 

 

 

 

 

4

5

5

5

5

4

 

5

3

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