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Due Diligence as Key Instrument of Investment Expediency Analysis

Author

Listed:
  • Alla Kasich

    (Kremenchuk Mykhailo Ostohradskyi National University)

  • Yaroslava Yakovenko

    (Kremenchuk Mykhailo Ostohradskyi National University)

Abstract

The purpose of the article lies in explanation of essence of 'due diligence' notion, distinction of its types, clarification of differences from traditional audit and substantiation of due diligence algorithm for Ukrainian companies on the basis of foreign experience. In Ukraine the due diligence is compared to legal audit. But the notion of the legal audit is much narrower and characterizes the legal expertise of company activity compliance with the requirements of the law. The due diligence types are discussed and its differences from the traditional audit are identified. The due diligence practical role is shown in estimation of advantages and disadvantages of the future agreement when approving the investment solution. It is found that due diligence allows the buyer to make high quality monitoring of the company business efficiency, and the potential investor – to estimate advantages and disadvantages of collaboration. On the basis of the foreign experience with due diligence, the recommendations are worked out concerning due diligence procedure in Ukraine.

Suggested Citation

  • Alla Kasich & Yaroslava Yakovenko, 2015. "Due Diligence as Key Instrument of Investment Expediency Analysis," Oblik i finansi, Institute of Accounting and Finance, issue 4, pages 92-97, December.
    • Handle: RePEc:iaf:journl:y:2015:i:4:p:92-97
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    More about this item

    Keywords

    due diligence; comprehensive inspection; investment evaluation; investing; incorporation;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

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