Normally due diligence is carried out where a consolidated group is acquiring another consolidated group or a stand alone entity or group of entities - are you looking at the most significant matters or are the entities being acquired bringing unrecognised problems into the group? This presentation covers topics including:
- joint and several liability exposure arising from membership of previous consolidated groups - lack of visibility
- risks from open assessment periods beyond four years
- latent tax liabilities which could be triggered on acquisition, for example
- CGT events L3, L5 and J1
- crystalisation of unrealised gains
- limitations on availability and utilisation of tax attributes
- changes in relative market values of group companies
- impact of gearing on available fraction calculations
- capital injection and other adjustments
- structural tax issues for the carry-forward entity arising from historical positions.