What Is Transaction Advisory?

Transaction advisory is a service, often found in accounting firms and other third-party organizations, that helps companies evaluate and navigate corporate transactions. This is most often applied to large purchases like mergers and acquisitions but has other applications like lender financing.

This advisory acts as your business’s support system throughout the transaction process to ensure your financials are properly prepared for the purchase.

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What Are Transaction Advisory Services?

The usual transaction advisory services are as follows:

  • Financial Structuring: Creating quality of earnings reports and restructuring cash flow and balance sheets so financials are working at optimum efficiency. This also includes looking at historical tax and transaction trends.
  • Financial Projections: Assessing the company’s current spending habits to determine how and/or if the company should proceed with the transaction.
  • Deal Negotiation: Supporting the company by communicating with boards of directors and other decision-makers to ensure the transaction goes through at a fair price.
  • Post-Closing Assistance: Advising the company on the future roadmap of the company, specifically how their new purchase should affect their future spending and business processes.
  • Sell-Side Assistance: Helping the selling entity prepare value propositions, valuation modeling, and other financial analyses to best prepare them for entering the market.

What Transaction Advisory Services Do

Above all else, transaction advisory services ensure both the buy- and sell-sides of a transaction enter negotiations with a complete understanding of the risks and opportunities. These services provide a form of legal and financial due diligence to ensure all variables are considered before moving forward with the transaction.

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