Moore Colson’s Consulting Practice Releases its 2020 Mid-Year Highlights
Friends,
We hope you are staying safe and healthy during these unprecedented times. While the start of 2020 has been quite unusual, the Moore Colson Consulting Practice is grateful to have stayed active serving our clients on a variety of engagements, especially during such a challenging time.
As we enter the second half of the year with as much enthusiasm as we started it, we wanted to share some top Consulting Practice highlights with you from the beginning of 2020. We also invite you to reach out and say hello as we would enjoy catching up with you.
Meet Our New Consulting Partner:
Geoffrey Tirone
Moore Colson recently announced the addition of Geoffrey Tirone, CPA, as a transaction services partner in the Consulting Practice. Geoff brings over 20 years of experience in the transaction space, working with both private-equity groups and strategic buyers on buy- and sell-side transactions. His experience also includes stints in private industry where he led accounting teams in transitional situations. We are excited to welcome Geoff and look forward to him bringing his extensive experience to assist Moore Colson clients. Learn more about Geoff’s background in our recent press release.
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Mid-Year Review: Engagement Highlights
Moore Colson Consulting is comprised of two distinct practice areas:
- Transaction Services offering buy-side and sell-side due diligence and quality of earnings analysis.
- Special Services offering turnaround and restructuring, interim management, forensic accounting, litigation support, debt advisory, mediation and arbitration, lender services, and court and estate fiduciary, among others.
Below is a selection of engagement highlights from both practice areas in the first half of 2020:
TRANSACTION SERVICES
Transaction Services Engagement #1: Sell-side
Overview:
We performed a sell-side due diligence on a $95 million revenue California-based company in the service industry.
What made this engagement particularly interesting?
The finance and accounting function at the company could not keep up with the significant growth the business experienced. There were two divisions with two sets of books with inconsistent accounting practices among years and divisions.
We identified over 20 EBITDA adjustments that accounted for $4.8 million in the LTM period which represented 44% of reported EBITDA. The client will be able to receive additional proceeds from the purchase price based on the work we performed.
Transaction Services Engagement #2: Buy-side
Overview:
We performed a buy-side due diligence on a $3 million revenue company headquartered in Michigan in the manufacturing industry.
What made this engagement particularly interesting?
The client was inexperienced at M&A, and they were working to rationalize the purchase of a carved-out division of a large conglomerate.
How we added more value:
Based on the Letter of Intent (LOI) that was submitted by our client, we determined through analysis that our client would be overpaying for the division by approximately 100 times of the true value. It became apparent that the selling company was not as forthcoming with the financial results they presented, and our Transaction Services experts were able to show the client these inconsistencies through our diligence.
Transaction Services Engagement #3: Buy-side
Overview:
We performed a buy-side due diligence on a $20 million revenue company headquartered in Cincinnati in the industrial automation industry.
What made this engagement particularly interesting?
The target company wanted to include certain demo inventory in the transaction, and we deemed the cost of that inventory to be inappropriate.
How we added more value:
We calculated an appropriate balance for the inventory and adjusted the financials so our client was paying a fair amount. We performed all work on this deal remotely during lockdowns stemming from the COVID-19 pandemic, allowing our client to be prepared to close on the deal once businesses reopened.
SPECIAL SERVICES
Special Services Engagement #1: Litigation Support
Overview:
We performed litigation support for a multi-family, residential real estate company where millions were allegedly misappropriated by one of the business partners.
What made this engagement particularly interesting?
Funds were misappropriated by the defendant in a variety of ways.
Moore Colson provided various analyses of multiple bank accounts and company financial statements to discover and expose the various fraud schemes. Once this case goes to trial, our Special Services team will serve as expert witnesses.
Special Services Engagement #2: Forensic Investigation | Litigation Support
Overview:
We performed a forensic investigation and provided litigation support for a national banking company.
What made this engagement particularly interesting?
The investigation centered on an event that started over 10 years ago and took over 4 years to work its way through all the procedures before it was discovered.
Moore Colson provided litigation support through forensic examinations of mortgages. The case is an example of how a small mistake can end up costing a company a large amount of money to correct.
Special Services Engagement #3: Forensic Accounting | Litigation Support | Expert Witness Service
Overview:
We performed forensic accounting, litigation support and expert witness services for a municipality related to a road expansion project and an associated condemnation of property.
What made this engagement particularly interesting?
The engagement entailed analyzing the financial results of a business allegedly impacted by the modification of its entrance associated with a road construction project. One of our Special Services team members prepared schedules for mediation purposes.
How we added more value:
We analyzed and compared the financial results of the business prior to the road construction and the associated condemnation and subsequent to the completion of the construction. In addition, we analyzed the schedules and calculation of losses prepared by the company's financial expert. Prior to mediation, a member of the Special Services team presented the analysis results, which showed that the financial expert’s analysis contained significant errors. The litigation settled in mediation.
Talk to an Expert:
If you are in need of Transaction Services or Special Services from our Consulting Team, we would welcome the opportunity to host a virtual meeting or socially-distanced, in-person chat. As described in our recent engagements, our team of experts is available to assist with a wide variety of services. We look forward to continue working with you in the second half of 2020, and wish you good health.
