Professional Documents
Culture Documents
Researcher
& Educator
Information
First Name: Long Family Name: Phan Occupation: Auditor, Finance & Banking Consultant Firm: National Auditing Group Position: Deputy General Director and Partner Main Qualification: Master of Business (Monash Uni, Aus), CMA, CPA Cell: 0906816226 e-mail: long@mekongnag.vn
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Agenda
What you have learnt? Due diligence in Vietnamese practice Firm valuation issues Industry analysis Case studies
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In business, due diligence refers to investigating all areas of an organization before agreeing to an important transaction or merger. The term "due diligence" first came into common use as a result of the United States' Securities Act of 1933.
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Questions asked An examination being achieved by asking certain key questions: How do we buy?
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We need information
Key Early Issues and Alarms Ownership and Capital Structure Directors and Governance Management Products and Services Research & Development and Technology Markets and Customers Competition Marketing, Selling, and Distribution
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DD in Vietnamese Practice Mainly focus on Legal and Financial Due Diligence Legal DD done by Lawyers Financial DD done by Auditors Financial DD is to answer the question How much will we pay?
Net asset method Discounted Cash Flow (DCF)
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Documents request list for Financial DD Documents request list for Legal DD Luvina DD Report Bigbang DD Report
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Real assets
Cash and cash equivalents Receivables Inventories Investments Fixed assets
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Investments
Fair value of investments
Listed equity OTC Long-term investments
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Real liabilities
Account payables Short and long-term loans
A/P and loans: confirmations
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Sample adjustments
Unit: VND Items Booked net ass et value (end of December 2010) 1 2 3 4 5 6 7 8 Write off the bad debts which were provisioned as doubtful debts at 31 December 2010 Write off the bad debts which were not provisioned as at 31 December 2010 Provis ion for doubtful debts as at 31 December 2010 Write off prepayment to suppliers which can not be recovered Write off the receivable amount from Boramtek (Contract No. 011996) and can not be claimed back and PIT Eliminate the overstated amount in other receivable and payble to employee Reclass ification of golf membership fee from other receivables to long term prepaid expense Provis ion for devalued inventory as at 31 December 2010 Amount 97,132,348,964 (1,309,056,022) (2,211,949,185) (1,251,759,968) (1,459,815,910) (317,343,200) (214,394,082) (855,078,334) (1,806,820,982) (9,426,217,682) 87,706,131,282 Notes
9 Write off advance to employees which can not be recovered 10 Write off deposit which can not be recovered 11 Provis ion for severance allowance 12 Record the foreign exchange rate difference to profit and los s account in 2010 Total amount Adjusted net asset value (end of December 2010)
Bigbang DD report
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Case study - RIC Read 3 recent years RICs financial statements Comments on factors that can affect net real asset value of the firm 15 minutes for reading 15 minutes for discussion
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Find 3 recent years audited financial statements of KMR (Cong ty Co phan Mirea - HOSE) Investigate relevant information of KMR
Comments on factors that can affect net real asset value of the firm Group presentation:
2 group will do presentation 10 minutes for each groups presentation 10 minutes for discussion among class
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Virtual Assets
Firm value do not only include net real assets but also virtual assets that results from: Value of human resource including management R&D Brandname Distribution channel Others These virtual assets were not recorded in the balance sheet of the firm.
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Contingent liabilities
Potential penalties Warranty obligations Guaranties Legal disputes Potential tax obligations Business commitments Contingent liabilities were not recorded in the balance sheet of the firm
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Discounted Cash Flow (DCF) Determine forecasted free cash flow of the firm Normally, at least 5 years in the future Using WACC as discounted rate WACC depends on risk of the firm
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Mt doanh nghip b hn ch vi c im ngnh kinh doanh m doanh nghip ang hot ng Xc nh ngnh kinh doanh
Ngnh kinh doanh rng Ngnh kinh doanh hp Xc nh theo vng a l (V d: cn thp min bc v min nam, Bt ng sn H Ni, TP.HCM)
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Vn vay 90%
Vn ch 10%
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Kim ton
Vin thng di ng
Hng khng
Doanh thu Li nhun
Thi gian
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S e do ca i th mi
T sut sinh li
S e do ca sn phm thay th
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M hnh 5 nhn t cnh tranh (Tip) Nhn t 4: Quyn m phn ca khch hng
Mc nhy cm v gi ca khch hng Chi ph chuyn sang nh cung cp mi ca khch hng Kh nng to khc bit ho (iPhone) s lng khch hng Khi lng trung bnh mua bi mt khch hng
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Researcher
& Educator
www.kiemtoan.com.vn
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