Write a financial due diligence scope of work that controls scope creep

The Scope of Work organizes what the team will review, with what data and by what time frame. I would not treat it as a list of headings intended to secure a business proposal. The starting point is the buyer's decision: what visibility is he looking for on the results, the financing of the activity and the commitments? An “NWC” section is insufficient if no one has specified the periods, price mechanisms or expected analyses.

A useful SOW also clarifies what the mission is not. Due diligence is not automatically an audit, evaluation or legal validation of the SPA. Contractual definitions may require discussions with counsel and parties. The professional must explain the planned procedures and data limits, without promising to confirm any information provided by management.

I would specify the entities, historical and recent periods, currencies, accounting framework and available sources. The number of entities alone does not tell everything: three companies on the same ERP can be simpler to process than two companies whose data is not similar. Consolidation operations, changes in scope and different systems must be included in the working hypotheses.

The expected format of the deliverable is another parameter. A quick red-flag report does not carry the same procedures as a detailed report including bridges, monthly analyzes and annexes. The SOW should describe the level of restitution, the language, the recipients and the modalities of discussion. Schedule goals should indicate dependencies: data availability, access management, and professional review deadlines.

I would formulate the works as observable procedures. For QoE: understand variations, reconcile results and examine candidate elements for standardization. For the NWC: analyze the components, seasonalities and payment practices within a defined scope. For debt: prepare a list of items and examine their proposed treatment, without claiming to impose the contractual definition.

The procedures must be able to evolve with the findings. We therefore need a mechanism for change rather than a promise of unlimited flexibility. Additional analyzes may be accepted, deferred or replaced by a reservation. This choice must be visible to the buyer, who decides between information, time and cost.

The initial mandate covers two entities and 36 months. Ten days before signing, a third entity is added with a different ERP. The temptation would be to treat it as a simple extraction supplement. I would start by understanding its weight, its history and the necessary accounting reconciliations. The risk is not just an additional number of lines: the new activity can modify the result, the NWC and the commitments of the acquired scope.

I would present a choice to the mission manager and the buyer: postpone certain work, strengthen resources, limit procedures on the new entity or adapt the schedule. Each option must indicate the consequence for the conclusions. A fee increase alone does not create the time needed to receive and review data.

The change must be documented: procedures added, assumptions, dates, responsible parties and remaining limits. If data cannot be obtained, the report must identify the scope actually analyzed. It is better to have a readable reserve than a complete theoretical perimeter for which the procedures have not been carried out.

I would periodically reconcile the work promised, the data received and the analyzes carried out. This follow-up can be light, but it must distinguish activity and result: a meeting held is not an answer obtained. Material blockages must be reported with their effect on a conclusion or deadline. Additional requests from the IRL are then placed back in the mandate rather than accumulated without control.

Mission closure deserves the same discipline. The manager must be able to identify completed procedures, alternative procedures and unresolved issues. The different versions of the report must retain significant changes in scope and the latest data dates. This traceability facilitates handover and avoids presenting a recent analysis as if it covered the entire history.

An assistant can compare a SOW, an IRL and a data inventory to suggest deviations. I would test its ability to detect an absent entity, a shorter period or a procedure without a source. The decision to modify the mandate remains a professional and contractual decision. An automated suggestion cannot bind parties or silently expand responsibilities.

To evaluate a workflow presented by Solenor, I would ask for a case where the scope changes after startup. The value is in making dependencies visible and preserving decisions. It does not consist of producing a generic SOW more quickly. A well-defined mandate protects the schedule and above all allows the buyer to understand what he knows, what he does not yet know and why.