During the Due Diligence process, the Acquisition Lead may request for a Cost of Goods test to be performed. AI will assist in obtaining the necessary data, but Accounting will perform the actual COGS test. The following steps outline the COGS testing process focusing on the AI role in it.
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Step |
Action |
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1 |
Acquisition Lead requests a Cost of Goods (COGS) test to be performed as part of due diligence |
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2 |
AI contacts the seller to obtain an inventory report that contains the unit of cost for active items Note: Must confirm cost is broken down to separate out landed cost and item cost if combined. |
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3 |
Seller provides inventory report to AI |
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4 |
AI saves a copy of the report in the seller’s Inventory folder in the Private folder on the Advantus Acquisition Integration SharePoint page
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5 |
AI sends a link to the inventory report to the Accounting contact (usually performed by the Manager or above) |
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6 |
Accounting follows its process to select a predetermined number of items that will go through COGS testing |
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7 |
Accounting sends a list of selected items to ai@advantus.com |
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8 |
AI contacts the seller to request the most recent vendor invoice for each of the selected items |
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9 |
Accounting follows its process to complete the COGS testing for each item |
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10 |
Accounting sends the results of the COGS testing to ai@advantus.com and includes the Acquisition Lead on the email |
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11 |
Acquisition Lead reviews results of COGS testing. If satisfied with the results, process is complete. If determines additional testing is needed, contacts Accounting to request additional items to be selected. |
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12 |
Steps 6-11 are repeated until satisfied with COGS testing results. |
