Assess whether working capital should be a walk-away from related-party

SITUATION In a cross-border deal with earnout-heavy structure, related-party revenue that disappears at decision is the evidence after IT diligence showing two ERPs and no chart of accounts map. Customer-contract risk reviewer has to pick Proceed or Reprice for this M&A Due Diligence Earnings and Revenue Quality close using related-party revenue that disappears at close.

DECISION Customer-contract risk reviewer in a cross-border deal with earnout-heavy structure must choose Proceed / Reprice / Walk / Hold using related-party revenue that disappears at close after IT diligence showing two ERPs and no chart of accounts map.

HYPOTHESES TO TEST 1. IT diligence showing two ERPs and no chart of accounts map is noise around an already-controlled Earnings and Revenue Quality process in a cross-border deal with earnout-heavy structure, given related-party revenue that disappears at close. 2. IT diligence showing two ERPs and no chart of accounts map is the event in related-party revenue that disappears at close that forces Proceed for customer-contract risk reviewer under M&A Due Diligence. 3. Related-party revenue that disappears at close shows a one-file miss after IT diligence showing two ERPs and no chart of accounts map, not a Earnings and Revenue Quality program failure. 4. Related-party revenue that disappears at close cannot decide working capital should be yet after IT diligence showing two ERPs and no chart of accounts map; hold is the only M&A Due Diligence close a cross-border deal with earnout-heavy structure can defend.

ANALYSIS REQUIRED 1. Separate a one-off add-back from a recurring earnings issue in related-party revenue that disappears at close. 2. Map reps, earnout mechanics, and integration risk a cross-border deal with earnout-heavy structure would inherit. 3. Tie quality-of-earnings, working-capital, and contingent items in related-party revenue that disappears at close to working capital should be. 4. For this M&A Due Diligence Earnings and Revenue Quality file, read related-party revenue that disappears at close against IT diligence showing two ERPs and no chart of accounts map and write the one fact that would move working capital should be for customer-contract risk reviewer.

RECOMMENDATION Choose Proceed / Reprice / Walk / Hold on this M&A Due Diligence / Earnings and Revenue Quality packet (related-party revenue that disappears at close after IT diligence showing two ERPs and no chart of accounts map). Lead with the M&A Due Diligence option related-party revenue that disappears at close can support after IT diligence showing two ERPs and no chart of accounts map, then the two facts that force it, then the Monday action for customer-contract risk reviewer in a cross-border deal with earnout-heavy structure.