Excerpt from First of 4 Charters
PreClose / Planning
- Retention Plans: work with teams to define costs
- Day 1: Ensure plans developed to ensure readiness for Close
- Org. Structure:Finance team migrates to Acquirer reporting Day One
- 2018 Spend: schedules reviews to control and manage; identify opportunities to reduce spending (duplicate functions, projects, activities); control payables and accruals
- Rev. Rec. / ASC 606: align accounting treatment; revenue roll forward; forecasts
- Earnouts: establish collaborative Investment planning and decision-making processes
- Audits: complete Acquired Co. audit by Sep.15; define ongoing SEC compliance requirements
- FP&A: align Management Reporting, define budgeting process, policies
Day One / Close
- Treasury: gain control of capital; bank account cutover; signature cards; cash / debt reporting, FX
- Tax: legal entity structure established; signatures obtained; tax filing calendar established; align tax compliance, planning and audit mgmt.
- Accounting: Billing/AR/AP cutover; align policies; support Close and G/L Consolidation, align Rev.Rec. accounting treatment until implementation finished, Map Chart of Accounts
- Employee Onboarding: support ERP data migration, US Payroll migration; migrate cards to Amex; retention and offer letters
- Sales: define compensation to support cross-selling
- DOA: establish roles/limits in ERP system
Day 30+
- Fixed Assets: migrate data and organize tracking and reporting in ERP
- India Transfer Pricing: see Definitive Agreement protections; initiate plan to modify
- VAT: see Definitive Agreement protections; initiate plan to modify
- 2025 Operating Budgets: schedule reviews to develop; align KPI’s; define chargebacks/allocations; define new cost centers
- QTC: support Quote-to-cash Workstream planning
- GTM: support Go-to-Market Workstream planning
- Product Integration: support SKU/PID setup in ERP
- Real Estate: initiate search for new space; identify and control all third-party relationships
- Cost-to-integrate budget: establish budget, process and controls for all Workstreams
Key Dependencies (Identify functional team)
- Employee Onboarding (HR, IT)
- Communications (HR, Marketing)
- Applications / Systems Access (IT, Hosting)
Risks / Mitigation Plan
- Lease expires mid-2025. Mitigation: perform site selection and renewal discussions immediately.
- India Transfer Pricing: cost plus model is 24% vs 15% high resulting in higher taxes. Mitigation: initiate plan to modify
- Staff Retention: loss of key talent and overload of work related to integration. Mitigation: approve key retention packages; contract to backfill over-loaded employees; initiate recruiting efforts
Primary integration objectives to be achieved post close:
- Implement optimal finance organization structure by end of year 1
- Meet synergy targets by end of year 1
- Seamless day 1 financial operations (pay employees, vendors, collect cash, combined financial reporting)
- Financial system migration/consolidation during year 1
- Consolidate and/or restructure debt and comply with covenants
- Consolidate tax entities and comply with REIT requirements
- Implement Investor Relations program to consider combined large cap investor opportunity/requirements