What is a financial due diligence databook?
A databook is the Excel workbook behind a financial due diligence (FDD). It holds the target company's figures as the diligence team analysed them: the statements, the adjustments and the reconciliations, period by period. Every figure the written report quotes comes from a table in it.
What a databook usually holds
- The P&L, balance sheet and cash flow of the historical years, often also by month.
- Quality of earnings: reported EBITDA, each adjustment and the adjusted EBITDA.
- Net working capital at each month-end, the basis for the target level (the peg) in the purchase agreement.
- Net debt and debt-like items: what the buyer deducts from the enterprise value.
- Analyses of revenue, customers, personnel costs and capital expenditure.
- Reconciliations to the annual accounts and the trial balance, so a reader can check where each figure comes from.
Databook and report
The report is the text the client reads: the findings, the risks and their effect on the price. The databook is the evidence underneath. A buyer's or a lender's team often asks for the databook itself, to link its own valuation model to it.
In a vendor due diligence the seller commissions the work, and the databook goes to the bidders with the report.
Where the time goes
In mid-sized companies in Germany and Austria the figures arrive as exports from the tax adviser's accounting software: trial balances (Summen- und Saldenlisten), BWAs and booking lists from DATEV, BMD or RZL. Building a databook by hand means mapping every account to a statement line, linking the years, and checking that the balance sheet balances and each year follows on from the one before. Every manual step is a place where a figure can go wrong unnoticed.
How sakto builds the databook
sakto reads the tax adviser's exports and builds the databook from them: an Excel workbook with live formulas, not pasted values. Every account balance is traced to file, sheet and row.
The databook sakto exports holds these parts:
- A cover, an executive summary and the scope and limitations of the work
- the P&L by year and month, and one period against another
- the balance sheet and cash flow by year
- NWC and net debt by year and month
- revenue gross to net, the personnel costs and the lender figures
- the checks
- the trial balance by year and month
- a sources sheet
- how each figure was calculated
- the mapping and its changes
- the management P&L and the EBITDA bridge with every adjustment
- the figures as one flat table to link your own Excel model to
- and, with a business plan loaded, the plan and its comparison with the books
The final databook exports only once every balance sits on a statement line, every check passes (balance sheet, trial balance, opening balances, equity roll-forward and five tie-outs) and every EBITDA adjustment has a reason. A draft is always possible, marked as one on every sheet. The databook exports in German or English.
Download a sample databook (Excel)
Questions
What is a databook in financial due diligence?
The Excel workbook behind the due diligence report: the target's statements, adjustments, working capital and net debt as analysed, period by period, with the reconciliations that show where each figure comes from.
Who reads the databook?
The diligence team builds it. The buyer, the lenders and their advisers read it and link their own models to it; in a vendor due diligence the seller hands it to the bidders.
Can sakto build a databook from a DATEV trial balance?
Yes. sakto reads DATEV's trial balance (Summen- und Saldenliste) as Excel or CSV, and the SuSa printed to PDF too, detects the chart of accounts (SKR03, SKR04 or the Austrian EKR) and exports the databook in German or English. Trial balances exported from RZL and BMD's account-grid export are read as well.