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Due Diligence in China + Website: Beyond the Checklists

Book Description

A plain-English guide that demystifies the business landscape in China from a due diligence point of view

Due diligence is crucial to any business deal, and, thankfully, due diligence research has come a long way over the years. What used to be a cumbersome, time-consuming process has been standardized and systemized with generally accepted auditing frameworks and tools, such as the all-important auditing "checklists." But when it comes to doing due diligence in China, with its opaque regulatory system and byzantine accounting standards, all bets are off. In this book an acknowledged expert in the field takes you beyond the checklists to arm you with China-specific due diligence strategies, tools and techniques that go beyond what is typically part of the process.

  • Gives a detailed account of why conventional frameworks used in the west simply don't work in China

  • Provides first-hand accounts based on the author's years of experience as a private equity professional doing deals in China

  • Reviews, in-depth, the unique differences between corporations and businesses in China and those in the West and their implications for the due diligence process

  • Uses numerous case studies to guide the reader through an entire due diligence process for a firm in China

Note: The ebook version does not provide access to the companion files.

Table of Contents

  1. Cover
  2. Contents
  3. Title
  4. Copyright
  5. Dedication
  6. Preface
  7. Acknowledgments
  8. Chapter 1: The Business Landscape in China
    1. Macro and Structural Domains
    2. Corruption in China
    3. Conducting Due Diligence in China versus Western Countries
    4. Conclusion
    5. Notes
  9. Chapter 2: Due Diligence in China
    1. Due Diligence for Different Types of Deals
    2. Levels of Due Diligence
    3. Key Considerations
    4. Organization of Due Diligence Process
    5. The Due Diligence Team
    6. Independence of Vendor Due Diligence
    7. Reasons for Poor Due Diligence
    8. Reverse Takeovers
    9. Dispute between SEC and CSRC
    10. Conclusion
    11. Notes
  10. Chapter 3: Financial Due Diligence
    1. Financial Due Diligence Checklist
    2. Conclusion
    3. Notes
  11. Chapter 4: Operational, Commercial, Legal, and Other Due Diligence
    1. Operational Due Diligence
    2. Commercial Due Diligence
    3. Legal Due Diligence
    4. Balanced Scorecard (BSC)
    5. How to Predict Bankruptcy—Altman Z Scores and Gearing
    6. Optional Checklists
    7. Conclusion
    8. Notes
  12. Chapter 5: Beyond the Checklists: Founder and Management
    1. Founder Management Root
    2. The Founder Background Check
    3. Guanxi (Relationship)
    4. Due Diligence on More Than One Founder
    5. Summary of Background Check: SWOPEST and Tri-Background
    6. Conclusion
    7. Notes
  13. Chapter 6: Beyond the Checklists: Hard Facts
    1. Face-to-Face Meetings
    2. Proportion Check
    3. Site Visits
    4. Due Diligence Goes One Step Deeper: The Four Deadly A’s
    5. Conclusion
    6. Notes
  14. Chapter 7: Implementing a Due Diligence Workflow
    1. Getting the Mind-Set Right
    2. Formulating the Due Diligence Strategy
    3. Forming a Team
    4. Starting the Due Diligence Process
    5. Conclusion
    6. Notes
  15. Chapter 8: Post Due Diligence and Case Studies
    1. Preparing the Due Diligence Report
    2. Due Diligence Outcome Review
    3. Deal Structuring, Negotiation, and Deal Making
    4. Post-Acquisition Due Diligence
    5. Summary Models
    6. Final Case Studies
    7. Conclusion
    8. Notes
  16. About the Website
  17. About the Author
  18. Index