How to calculate trade creditor days
The trade creditor days measure essentially allows you to calculate how long it is taking a business to pay its suppliers. Comparing the average trade …
Prepayment definition
A prepayment is commonly defined as an expense which has been paid in advance of its due date. As cash has been paid up front, …
How to analyse revenue
Revenue is simply the amount that a company makes from selling its products and/or services to its customers. Within the profit and loss, revenue is …
Enterprise Value to Equity Value Bridge
The Enterprise Value to Equity Value bridge is the most important concept in transaction purchase price calculations. The key point to understand is that transactions …
Adjusted EBITDA & Examples of Adjustments
Adjusted EBITDA is calculated by taking Reported EBITDA and adjusting for any one-off or exceptional items. It is commonly used in acquisitions with enterprise value …
Mergers and Acquisitions (‘M&A’) Definition
Mergers and acquisitions (‘M&A’) is a term used to describe the purchase or consolidation of companies or trade and assets. Types of acquisitions Acquisitions either …
Accrued Revenue Definition
Accrued revenue arises because of the accruals basis of accounting, which states that revenue should be recorded in the profit and loss across the period …
Deferred Revenue Definition
Deferred revenue arises because of the accruals basis of accounting, which states that revenue should be recorded in the profit and loss across the period …
What is Financial Due Diligence (‘FDD’)?
Financial due diligence (‘FDD’) is a review of a Target company’s financial information prior to a proposed transaction. FDD is often used to support deal …