A quick review of an Analyst in Transaction Services’ job…

December 31, 2022 by Louis DETALLE

A quick review of an Analyst in Transaction Services’ job…

In this article, Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) explains what does an analyst in Transaction Services work on.

What does Transaction Services consist in?

The Transaction Services consultant assists clients and advises them on their financial transactions. He or she works on disposals, mergers and acquisitions, and restructuring. Clients of a Transaction Services department are generally investment funds, investment banks or very large companies that conduct financial transactions and require the expertise of a Transaction Services team.

What does a Transaction Services analyst work on?

There are two types of missions: buy-side and sell-side due diligence. The approach is different depending on whether you are on the buy side or the sell side. We will review what these missions consist in.

A due diligence is conducted by a specialized audit firm, its objective is to evaluate the risks inherent in the target company when the latter is being sold for instance. All the checks are made possible to understand the company’s strategy, to analyze its strengths and weaknesses, and also to have an overview of its accounting, financial, tax, social and environmental situation.

This analysis is therefore based on the analysis of the historical performance, cash flow and assumptions made in the business plans of the target company.

Calculations of metrics and normative ratios (e.g., EBITDA) or an in-depth analysis of the company’s working capital requirements, sector and business model are also carried out.

In short, the mission of Transaction Services is to carry out all the analyses to ensure that the client and the parties involved do not make any mistakes on the valuation of the company.

What are the biggest Transaction Services firms?

Deloitte, Ernst and Young (EY), PricewaterhouseCoopers (PwC) and KPMG are the four audit and consulting firms that make up the Big Four. They are the most influential consultancies in the world, employing nearly 1,200,000 people worldwide.

What are the main jobs possible after a Transaction Services position?

Some former Transaction Services staff move into areas such as investment banking, private equity (PE), controlling or mergers and acquisitions (M&A). Others use their time in Transaction Services to target departments where they can re-use the skills they have acquired.

To go into M&A or PE, Transaction Services will lack modelling, and this should be kept in mind. Thus, consultants are often found in managerial positions, M&A managers or even in the financial department. Eventually, the excellent command of numbers, operations and the ecosystem allow some to become partners.

Resources

Youtube How to nail TS interviews?

KPMG Careers website

EY Careers website

About the author

The article was written in December 2022 by Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023).

My experience as a Transaction Services intern at EY

December 28, 2022 by Louis DETALLE

My experience as a Transaction Services intern at EY

In this article, Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023) interviews a former Transaction Services intern at EY.

First of all, let’s recall what Transaction Services consists in?

The Transaction Services (TS) consultant assists clients and advises them on their financial transactions like disposals, mergers and acquisitions and restructuring. Its clients are generally investment funds, investment banks or very large companies that conduct transactions and require the expertise of Transaction Services teams.

In short, the mission of Transaction Services is to carry out all the analyses to ensure that the client and the parties involved do not make any mistakes on the valuation of the company.

Where had you applied for and what makes EY different from other big 4?

It was my second significant internship in corporate finance, for that matter, I wanted to get into M&A or Private Equity, but both are pretty complicated to get into. For that matter, I figured that it would be easier for me to apply for a Transaction Services internship or in M&A corporate. I quickly got interviews at EY, Deloitte and KPMG.

I chose EY because I really got along with my manager-to-be; he insisted that they would make me work on interesting stuff and they offered be the position first.

What does an intern in TS work on?

As you may know, in TS, there are two types of missions: buy-side and sell-side due diligence. The approach is different depending on whether you are on the buy side or the sell side.

As an intern, my job was to help my team assess the risks inherent in the target company while preparing the due diligence. For that matter, all of the checks are made possible to understand the company’s strategy, to analyse its strengths and weaknesses, and also to have an overview of its accounting, financial, tax, social and environmental situation. I could help them on any of the topics above, although the tax aspect of the company was given to a dedicated department.

In the due diligence, I can assist my team in the reading of documents from the major international institutions for all the data relating to global and entire sectors for the specific sections of the due diligence.

Also, a last type of task that I was given was taking notes about Q&A sessions that occur during the M&A process. I would thereafter write a summary for the team.

What do you plan to do next?

Most former Transaction Services intern go for investment banking, private equity, controlling or M&A internships.

As a consequence, I believe that this is what I will do next, I can wait to be on the banking side of the merger! The advantage of my internship is in fact twofold. On the one hand, it allows me to have EY on my CV and on the other hand, I have experience that finance recruiters describe as “significant finance work experience”. So I can do many things afterwards and that is the strength of my internship.

Overall, would you recommend this experience to younger students? Why?

I would personally recommend this experience to anyone who is interested in corporate finance. Because it is one of the rare fields where you gain a lot of knowledge about financial modelling. When you work in TS, you spend most of your time on Excel and this will be a valuable skill for your following internships.

For that matter, it is an excellent internship, and anyone would be very lucky to do this internship because it would mean great exposure and lots of financial analysis.

Resources

EY Careers website

Youtube How to nail TS interviews?

About the author

The article was written in December 2022 by Louis DETALLE (ESSEC Business School, Grande Ecole Program – Master in Management, 2020-2023).

My experience as an M&A/TS intern at Deloitte

August 10, 2022 by Basma ISSADIK

My experience as an M&A/TS intern at Deloitte

In this article, Basma ISSADIK (ESSEC Business School, Global Bachelor of Business Administration, 2019-2023) shares her experience as an M&A/TS (Mergers and Acquisitions / Transaction Services) Intern at Deloitte.

Summer 2021, I was able to intern at Deloitte Casablanca for a couple of months. I was in the Transaction Services team which was in charge of advisory in deal and IPO readiness, target screening, sell-side and buy-side due diligence, transaction accounting and reporting, and business integration or separation. Transaction services typically refers to the services provided when a business transaction takes place. An example of a business transaction would be a merger or acquisition of a company.

Deloitte

Founded in 1845, Deloitte is one of the biggest professional service providers in the world. Being one of the “Big Four” accounting firms, it provides services in audit and assurance, consulting, financial advisory, risk advisory, tax and legal advisory. Deloitte was founded by William Welch Deloitte in London in 1845 and expanded into the United States in 1890. It merged with Haskins & Sells to form Deloitte Haskins & Sells in 1972 and with Touche Ross in the US to form Deloitte & Touche in 1989. As of 2020, Deloitte is the third-largest privately-owned company in the United States, according to Forbes. The firm has sponsored a number of activities and events including the 2012 Summer Olympics.

Logo Deloitte.

Source: Deloitte.

My internship at Deloitte

When I arrived at Deloitte in July 2021, the team was working on a specific project in cooperation with the Minister of the Industry. I was in charge of analyzing the eligibility of our clients to obtain financing from the Minister of the Industry. We already had set criteria for the companies that would later be presented to the Minister of the Industry. Our mission was to select the interesting project in accordance with the “banque de projet” which had already been established and advise the companies to meet the criteria as best as they can. These criteria were of different natures:

In financing for instance, there should be a portion of the project financed by the shareholders / founders.
The forecasted financial figures should be realistic.
The business plan should fit within the criteria and so on…

The junior analysts made sure I was closely supervised and assisted whenever I needed help with anything. I was communicating with them on a daily basis, and they all ensured I had a great experience at Deloitte which is what differentiates the firm from other competitive professional services companies. From the start I was given a lot of responsibilities which I was very happy about. I was able to participate in meetings and had the opportunity to lead one at the end of my internship. It was a really good experience in a way that enabled me to have direct contact with professionals and feel very useful to the team as well.

Skills needed

To have some experience in accounting
To be able to communicate and interact with the team
To possess analytical skills and problem-solving skills
To be familiar with financial reporting
To be familiar with digital tools such as pptx and excel
To have a strong learning ability
Be able to take responsibilities early on

What I have learnt from the internship

This internship has taught me a lot on the importance of meticulousness and how vital it is to be very rigorous with the data we are given and the analysis we do of it. I have also learned lots about the role of an auditing and consulting firm in advising clients to make the best decisions for their companies.

Key concepts related to my internship

Due diligence

Due diligence is an investigation, audit, or review performed to confirm facts or details of a matter under consideration. In the financial world, due diligence requires an examination of financial records before entering a proposed transaction with another party. Due diligence (DD) is an extensive process undertaken by an acquiring firm in order to thoroughly and completely assess the target company’s business, assets, capabilities, and financial performance. There may be as many as 20 or more angles of due diligence analysis.

The main types of due diligence inquiry are as follows:

Administrative DD: Is the aspect of due diligence that involves verifying admin-related items such as facilities, occupancy rate, number of workstations, etc.
Financial DD: Financial DD aims to provide a thorough understanding of all the company’s financials, including, but not restricted to, audited financial statements for the last three years, recent unaudited financial statements with comparable statements of the last year, the company’s projections and the basis of such projections, capital expenditure plan, schedule of inventory, debtors and creditors, etc.
Legal DD
Asset DD
Human Resources DD
Environmental DD
Taxes DD : Due diligence in regard to tax liability includes a review of all taxes the company is required to pay and ensuring their proper calculation with no intention of under-reporting of taxes.
Intellectual Property DD: Almost every company has intellectual property assets that they can use to monetize their business. These intangible assets are something that differentiates their products and services from their competitors.
Customer DD
Strategic Fit: Acquirers are generally also very careful about exercising due diligence in regard to evaluating how well the target company fits in with the overall strategic business plan of the buyer.

Why should I be interested in this post

You should be interested in this post if you are interested in working in finance in general because it might help you understand if you would like to work in the field or not, and maybe help you refine your professional project.

Useful resources

Deloitte

About the author

The article was written in August 2022 by Basma ISSADIK (ESSEC Business School, Global Bachelor in Business Administration, 2019-2023).