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US DFC Due Diligence Checklist

The document outlines a due diligence checklist for the U.S. International Development Finance Corporation. The checklist includes gathering general background information on the organization, reviewing financial statements and projections, examining organizational performance history, understanding operations, evaluating the proposed transaction structure, and collecting country-level diligence. The goal is to conduct thorough due diligence across various topics to inform DFC's investment decisions.

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Citizen Koum
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255 views2 pages

US DFC Due Diligence Checklist

The document outlines a due diligence checklist for the U.S. International Development Finance Corporation. The checklist includes gathering general background information on the organization, reviewing financial statements and projections, examining organizational performance history, understanding operations, evaluating the proposed transaction structure, and collecting country-level diligence. The goal is to conduct thorough due diligence across various topics to inform DFC's investment decisions.

Uploaded by

Citizen Koum
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Due Diligence Checklist

DFC Due Diligence Checklist


for the
U.S. International Development Finance Corporation

A. GENERAL BACKGROUND

1. Mission, history, and evolution of organization


2. Regulatory framework & oversight
3. Governance: background of senior management, Board of Directors, and shareholders
4. Discussion of the project landscape - supply, demand, needs, impact
5. Company strategy moving forward
a. Target markets by sector and geography
b. New product lines (if any)
c. Access to finance outreach efforts
d. Goals and objectives
e. Risk mitigation
f. Challenges and hurdles
g. Ratings

B. FINANCIAL STATEMENTS

1. Balance sheet, income statements, auditors’ reports and investor reports


2. If applicable: outstanding debt, current funding mechanisms, proposed debt structure, bond
transaction terms and characteristics
3. Projections – future sources and uses of funds
4. Liquidity management, exchange risk management
5. Investor communications – regional and international
a. Fundraising
b. Ongoing reporting
6. Project performance history

C. ORGANIZATION PERFORMANCE HISTORY

1. Organizational performance impact


2. Key revenue components’ characteristics and history
3. Trends and comparison of performance by sector
4. Projects’ characteristics
5. Country, region, geographic impact

Prepared by
DFC Due Diligence Checklist

D. OPERATIONS

1. Financial terms and structure, credit criteria, collateral exposure


2. Brief review of key business agreement terms
3. Reporting requirements (regulatory, internal, etc) and operational tools utilized
4. Project/program administration and non-compliance management, enforcement
5. Collateral pledging mechanism
6. Collateral valuation
7. Internal controls and risk management

E. TRANSACTION STRUCTURE

1. Financial terms, subordination levels


2. Proposed transaction structure, location, bankruptcy remote protection, tax issues, potential
stakeholders
3. Legal framework
4. Step-by-step process for various levels of approval required transaction progression
5. Ratings process
6. Structure proposals
7. What would liquidation look like in event of default?
8. Any existing debt? If yes, any conflict or intercreditor issues with existing debt?
9. Expected sources of investment
10. Use of proceeds and potential DFC side agreement components
11. Hedging opportunities

F. COUNTRY-LEVEL DILIGENCE

1. Market dynamics and current conditions in local country and region. Future predictions for
demand. Funding needs – where are the gaps?
2. Project performance trends
3. Supply dynamics – relationships with partners, etc.
4. Origination process, product types, access to finance initiatives or other special programs
targeted to potential customers
5. Program administration, recovery process, expected loss ratio

G. ORGANIZATIONAL DOCUMENTS

Prepared by

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