OPERATIONS LINKAGES TO THE P&L, BALANCE SHEET, AND CASH FLOW REPORTS

The profit and loss (P&L), balance sheet, and cash flow reports are the key documents used to conduct the financial assessment and valuation of a business. These reports are generally thought of as the domain of accounting and are core to the financial due diligence, but they also play an important role in operations and the Operations Due Diligence. The goal of your assessment will be to validate the sources of the data contained in these documents and explore the implications of this data on the future operations of the business. For instance, what is the process for making sales projections or the policy for qualifying travel expenses? While there are separate goals for the financial and operations assessments, they need to be conducted....Has the accuracy of the business’s financial reports been validated?