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In conducting the due diligence from a business perspective, the buyer's team is likely to encounter a wide variety of financial problems and risk areas when analyzing the seller. These typically include an undervaluation of inventory, overdue tax liabilities, inadequate management information systems, related-party transactions (especially in small, closely held companies), an unhealthy reliance on a few key customers or suppliers, aging accounts receivable, unrecorded liabilities (e.g., warranty claims, vacation pay, claims, and sales returns and allowances), or an immediate need for significant expenditures as a result of obsolete equipment, inventory, or computer systems.