What is the difference between a financial due diligence and a legal due diligence?

What is the difference between a financial due diligence and a legal due diligence Introduction: The Crucial Phases of Business Transactions Hello everyone! When it comes to business transactions, there are several crucial phases that need to be meticulously executed. Two such phases are financial due diligence and legal due diligence. While both are essential, they serve distinct purposes. Today, we'll explore the differences between these two processes and understand their significance in the business world. Financial Due Diligence: Unveiling the Financial Landscape Financial due diligence is a comprehensive examination of a company's financial health. It involves a thorough analysis of financial statements, tax records, cash flows, and more. The primary objective is to assess the accuracy and reliability of financial information provided by the target company. This process helps potential buyers or investors gain insights into the target company's financial risks, opportunities, and overall value. It also aids in evaluating the feasibility of the transaction and negotiating favorable terms. Key Aspects of Financial Due Diligence