Corporate Finance roles in professional services firms

السلام عليكم

Alhamdulliah this is a great resource. Allah give you tawfiq in your efforts.

I’ve read about the Fatwas on working in M&A roles for investment bank, but what about for Professional Services firms like the Big4 (pwc, Deloitte, KPMG, ey)?

An M&A role in an Investment Bank will be very similar to one in a professional services firm. E.g helping a client acquire a company, sell a company, raise finance (debt or equity). However a professional services firm isn’t a bank so will go to other banks to raise finance.

In working in this area would you still recommend trying to avoid transaction where we would be trying to raise debt finance for a client?

Wa alaykum salaam brother,

Yes, trying to raise debt finance on interest where you are intrinsically involved and play a material role in the raise is non-Shariah compliant activity.

Thank for the reply Mufti Saab,

Would it also be impermissible to help make a financial model or draft a due diligence report. Which a client would pay you for. Then the client would use the same report or financial model to raise debt finance.

Technically you are just making a financial model or writing a report. But the an objective of the model and report is to show how company can take on extra debt, use it to grow and pay off the capital and interest.

Wa alaykum salaam,

This will be depend on two things:

  1. If the report can be used for any permissible reason.

  2. The client has full discretion on whether he wants to proceed and he himself will execute the financing agreement.

Generally Due diligence report and financial models can be used for multiple purposes. E.g. to help sell a company or to raise finance from a bank.

The report or model might be created a certain way to help with raising the finance. But it will be the client or the corporate finance team going to raise the finance.

From the information you have submitted, it seems closer to being Shariah compliant from my perspective.