ARQ Duplicate by Byond1 | Aug 6, 2019 | 0 comments Welcome to your ARQ Duplicate Is there agreement among the Executive Team and/or Business Owners on why the company is acquiring? Yes No Not sure Please estimate the percentage of your customers who are VERY SATISFIED with the services/products which your company provides: Less than 25% of our customers are “very satisfied”. 25%-50% of our customers are “very satisfied”. 51-75% of our customers are “very satisfied”. More than 75% of our customers are "very satisfied". I’m not sure - we don’t measure customer satisfaction. How often, if at all, do your existing customers refer your company to their friends and colleagues? Always Sometimes Rarely Never Unsure In the last 12 months, what proportion of your customers complained in writing (e.g. email, letter, submission to your website)? None Less than 1% 1-5% 5-10% More than 10% Which of the following best describes your business model? Our net profit margin goes down with each new customer who buys from us. Our net profit margin stays about the same with each new customer who buys from us. Our net profit margin improves a little, the more customers buy. Our net profit margin improves a lot with each new customer who buys from us. Unsure How do you typically get paid by your customers? 100% billed after the customer receives what they have purchased. An upfront deposit, followed by the full balance after the customer receives what was bought. Spread equally over the time it takes us to deliver what the customer bought. 100% billed when the customer agrees to buy. Unsure What percentage of your sales/revenue (i.e. turnover) is “recurring”? Recurring is defined as subscriptions, maintenance contracts, or annuity streams that your customer must proactively turn off or cancel in order to stop receiving the product or service. None 1-25% 26-50% 51-75% 76-100% Unsure Think Ahead In the next 12 months, do you expect your revenue (i.e. sales / turnover) to: Decrease Remain at its current level Increase by up to 10% Increase by between 11 and 20% Increase by 21-30% Increase by more than 30% Unsure Which of the following best describes the possibility of your company selling more to your existing customers? Our customers are pretty much tapped out - we already sell them everything they need when it comes to our products/services . There are one or two complementary products or services we could be selling to our existing customers. There are a reasonable amount of other products and services we could be selling to our existing customers. There are lots of other complementary products and/or services we could be selling to our existing customers. Unsure If customers were lined up at your door to buy, would you find delivering FIVE times the current volume of what you sell: Impossible Very difficult Fairly difficult Fairly easy Very easy Unsure Would replicating your business to serve a new geographical area be: Impossible Very difficult Fairly difficult Very easy Unsure If you could achieve just ONE of the following goals in the next 12 months, which one would it be? Grow your top-line revenue (i.e., sales). Grow your bottom-line profit. Enhance your company reputation. Which of the following best describes your long-term goal for your business? I plan to: Sell my business to a third party Transition my business to my kids Transition my business to the next generation of managers Shut down my business Not exiting in the foreseeable future Other Strategy Why is your company acquiring? Improve the target company’s performance. Consolidate to remove excess capacity from industry. Get skills or technologies faster or at lower cost than they can be built. Accelerate market access for the target’s (or buyer’s) products. Exploit a business’s industry-specific scalability. Pick winners early and help them develop their businesses. Other Not Sure Which of the following best describes the typical level of customization which you offer your customers? We offer a complete custom solution to meet the unique needs of each customer we serve. We have a basic set of products, methodologies and services, but we often customize them a lot for customers. We have a standard set of products, services and methodologies that we tweak slightly for some customers. We do not customize our products, services or methodologies for individual customers. Unsure Are SMART acquisition objectives in place and being used? (SMART – Specific, Measurable, Actionable, Realistic and Timely). Yes No Not sure Have target characteristics been specified? Yes No Not sure Facts & Figures 24. What was your profit margin (before tax) in your most recent completed financial year?Note: Please adjust your profit margin to reflect a market rate salary for the owner(s). For example, if you withdrew $350,000 in compensation but you could hire someone to replace you for $120,000, then estimate what your profit margin would have been if you had only withdrawn $120,000. We lost money. 0-10% 11-20% More than 20% Unsure 25. What was your company’s annual revenue (i.e. sales / turnover) in US DOLLARS last year? Less than $100,000 $100,000 - $499,999 $500,000 - $999,999 $1,000,000 - $2,999,999 $3,000,000 - $4,999,999 $5,000,000 - $9,999,999 $10,000,000 - $19,999,999 $20,000,000+ 26. When comparing your most recently completed financial year with the previous year, did your revenue (i.e. sales / turnover): Decrease Remain at its current level Increase by up to 10% Increase by between 11 and 20% Increase by 21-30% Increase by more than 30% Unsure Which of the following best describes your approach to financial record keeping? We give our accountant a stack of receipts and they figure it out. We keep track of things ourselves using an accounting package (e.g. QuickBooks, Simply Accounting etc.). We hire an accounting firm to prepare a "Notice To Reader" statement each year. We hire an accounting firm to conduct a “Review Engagement” each year. We hire an accounting firm to produce “Audited Statements” each year . What is your typical gross profit margin? Gross profit margin is defined as the proportion (percentage) of money left over from sales (i.e. turnover/revenue) after accounting for the cost of goods sold. (For example, if your company sells a product for $200 and it costs your business $80 to buy the raw materials to make your product then your gross profit would be $120 and your gross profit margin would be 60%). Less than 40% 40%-60% 61-80% More than 80% Unsure Please select which of the following statements best describes your cash needs: We need more cash than we generate, so we’re regularly trying to raise or borrow money. We need more cash than we generate so we're occasionally trying to raise or borrow money. Our business generates excess cash which we keep in the company as a “rainy day” fund. Our business generates excess cash which we distribute to shareholders regularly. Unsure Do you have a relationship with financial institution/investor so you can borrow money without having to provide collateral? Yes No Do you know how much money you can borrow today without collateral being required? Yes No Please estimate your influence by calculating the total number of people who have opted in to receive information from you and/or your company in the form of signing up for your website (e.g. newsletter, email mailing list or blog), Twitter "Followers", Facebook "Fans", RSS subscribers or people who have added you to their Google Plus "circles". None 0-999 1,000-9,999 10,000-99,999 100,000+ In one sentence, how would you describe your business to a new acquaintance (i.e. what does your company do?) Were there any major issues identified in a previous audit? Yes No Not Sure N/A, We Have Not Been Audited How well documented are your customer agreements under which your company delivers products? Customer agreements exist, but are not documented and may not be current. Some customer agreements are documented, but not all of them. All customer agreements for the top 10 customers by revenue are fully documented and signed off internally. All customer agreements are fully documented, executed, signed off internally and stored with a summary of material terms. What is the legal entity of your business? Limited Liability Company C Corporation S Corporation Partnership Sole Proprietorship Other In one sentence, how would you describe your business to a new acquaintance (i.e. what does your company do?) Would you say that your industry is: In decline (shrinking) Growing at about the rate of the economy Growing a little faster than the economy Growing much faster than the economy Unsure Your Business When was the last time your business was audited by an independent auditor? Which of these best describes your knowledge of an audit? I have no idea what is required to go through an independent audit of my business I have some idea that I need to prepare documents, but I'm not sure which ones I'm aware of what documents need to be prepared and how the process is meant to work I'm aware of the documents I need and am familiar with the process Has your business ever gone through a merger, acquisition, or spinoff? Yes No Not sure Which of these best describes your knowledge of a merger, acquisition, or spinoff? I have no idea what is required to go through a merger or acquisition of a business I have some idea of the documents I need, but I’m not sure which ones I’m aware of what documents need to be prepared and how the process is meant to work I’m aware of the documents I need and am familiar with the process Which of these best describes how your business plan and strategy are documented? The business plan and strategy are not documented A business plan was developed a few years ago, but has not been updated in a few years A simplified business plan is updated at least annually A detailed business plan is updated at least annually. It covers all aspects of the business and incorporates market trends and insights, outputs from financial forecasts, and pricing, marketing and funding strategies. Which of these best describes how your organizational structure, including its history and status, is documented? The business structure is not documented Most of the business structure is documented, but has not been updated in a few years The history of the company is well documented, as well as the current status of products, customer segments, business units, and legal entities The history of the company is fully documented, signed off internally, and stored electronically with a summary of material terms What approach do you take to forecast the financial results of your business? No formal forecasts are made. Financial forecasts have only recently been implemented, or the last forecasts were developed more than 12 months ago. Financial forecasts have been developed at least annually for the last 3 years and are based on historical trends. Financial forecasts have been developed at least annually for the last 3 years and are based on a robust analysis of our market, including projections based on operational metrics, EBITDA and by business unit and product. What documentation is prepared to enable your management team to track the performance of your business and inform future decisions? None We have management reports for the current year but not prior. We have management reports for the most recently completed financial year, and the current financial year. We have management reports for the previous two financial years, and the current financial year. How well are your key performance indicators documented and reports documented? They are not formally documented. Some are documented, but some are incomplete or out of date. All relevant metrics around sales volume, sales generation, and conversion, operations, and customer service are fully documented. Same as above and stored electronically, including a description of how often each metric is measured and reported, and the most recent performance of the business against each metric. How well are the contractual agreements with your employees and staff documented, including employee agreements, training, leave, and benefits? Employees do not have formal employment contracts. Some employees have a formal employment contract. Every employee has a formal employment contract describing their employment, compensation and benefits. Every employee has a formal employment contract describing their employment, compensation and benefits kept in a Human Resources system. How well are the company’s HR policies and plans documented, including all internal company rules and regulations related to employee behavior, rights and obligations? None of our HR policies and procedures are documented. Some of our HR policies and procedures are documented, but most are out of date. Most of our HR policies and procedures are documented, but only a few are regularly updated. All of our HR policies and procedures, including pensions, annuity plans, share options, stock ownership, or profit sharing plans, and severance plans are documented and regularly updated. What is the legal name of your business? Do you have documentation identifying all the intellectual property assets held or utilized by the company? No, there is no formal documentation. Yes, there is documentation, but is incomplete and out of date. Yes, we have documentation listing all patents, copyrights, trademarks, web domains, and trade secrets held. Same as above, but with additional information including date acquired, carrying value, jurisdictions in which regulatory protection is held, and expiry date of regulatory protection for each IP asset. Do you have documentation of all internal company rules, regulations, and systems in place, designed to maintain compliance with specific laws and regulations? No, none of these are documented. Yes, there is documentation, but is incomplete and out of date. Yes, we have documentation listing all compliance policies and procedures, including those regarding document retention and destruction, quality control, training registers, privacy and maintenance of data, and those that ensure compliance with trade practices and consumer protection regulations. Same as above and stored electronically, including any minimum training regulations, all industry compliance policies, such as fraud compliance, anti-money laundering, or know your customer policies. Do you have documentation of all internal company rules, regulations, and systems in place, designed to maintain compliance with specific laws and regulations? No, none of these are documented. Yes, there is documentation, but is incomplete and out of date. Yes, we have documentation listing all compliance policies and procedures, including those regarding document retention and destruction, quality control, training registers, privacy and maintenance of data, and those that ensure compliance with trade practices and consumer protection regulations. Same as above and stored electronically, including any minimum training regulations, all industry compliance policies, such as fraud compliance, anti-money laundering, or know your customer policies. Do you have documentation of all internal company rules, regulations, and systems in place, designed to maintain compliance with specific laws and regulations? No, none of these are documented. Yes, there is documentation, but is incomplete and out of date. Yes, we have documentation listing all compliance policies and procedures, including those regarding document retention and destruction, quality control, training registers, privacy and maintenance of data, and those that ensure compliance with trade practices and consumer protection regulations. Same as above and stored electronically, including any minimum training regulations, all industry compliance policies, such as fraud compliance, anti-money laundering, or know your customer policies. What is the quality of your documentation, accounting and reporting of your tangible assets (buildings, equipment, etc.)? We do not have an asset register or a central repository of asset records. We have documentation and can generate an asset register. We have an asset register and report at least annually using both tax and accounting asset register. We can generate key metrics like historical cost, residual value, depreciation rate, useful life, etc. Same as above and perform regular stock takes of the fixed asset register and report monthly. Your new question! CyberSecurity Have all organizational physical devices/systems, software platforms and applications been inventoried? Is the baseline configuration controlled? Yes, and is kept current. Partial. Little to None What organization provides your internet capability? How is your company and client information stored? Do you have your own servers? Cloud storage? If your company utilizes cloud storage, which company provides it? Are all company personnel trained in their cybersecurity roles and responsibilities, and is refreshment training provided for:Check all that receive such training. Users? Privileged Users? Management and Executives? Third Parties (e.g. outside vendors, suppliers) Your Customers Which of the following best describes the exclusivity of your business to your customers: We sell a commodity product/service that our customers can get from many other suppliers. We sell a product/service that our customers can get from a few other suppliers. We have a niche product/service that is unique in the marketplace so our customers would have to work hard to find another supplier of what we sell. We have a monopoly on the service/product we sell. Unsure Thinking about the market share for the products / services that you sell, do you sell to: Most of the people who buy what you provide (more than 90% market share). More than half of the people who buy what you provide (more than 50% market share). Less than half of the people who buy what you provide (less than 50% market share). A very small proportion of the people who buy what you provide (less than 10% market share). 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