Due Diligence Best Practice Guide

DEPARTMENT OF EDUCATION, TRAINING AND EMPLOYMENT
Queensland VET Sector

Partnership Due Diligence
A Best Practice Guide for
Department of Education, Training and Employment

Queensland Government Australia
TAFE Queensland International
Education House
30 Mary Street
Brisbane Qld 4000
PO Box 15033
City East Qld 4002
EMAIL: TAFEQueenslandinternational@deta.qld.gov.au
WEB: http://training.qld.gov.au/international
December 2011
Queensland VET Sector
International Education: Best Practice Guide Series

Queensland Government, Australia
Acknowledgments
This guide has been developed by the International Education Resources Group for the Queensland Department
of Education, Training and Employment. Copies of this guide and associated resources are available on the
Queensland Department of Education, Training and Employment website at http://training.qld.gov.au/
information/tafe-qld-international/best-practice-guides.html.
Disclaimer
This Guide, Partnership Due Diligence, contains ideas and examples on recognised industry good practice in
conducting due diligence of international partnerships. It has been developed in good faith to support the
Queensland VET sector and is intended for use as a source of ideas and options that can be adapted and
customised for a provider’s unique situation. The Queensland Government disclaims all responsibility and
all liability for any expenses, losses, damages and costs that might incur as a result of the information in this
guide, and accompanying provider resources, being inaccurate or incomplete in any way, or from the use of,
or reliance on, this material.
For Further Contributions

By their very nature, Best Practice Guides are a work in progress. They are a snapshot in time of how providers
are dealing with a topic and/or market opportunity. It is not possible to capture every detail regarding
the subject or every provider’s experience. As a dynamic industry resource - your ongoing submissions,
contributions and ideas are welcomed - please email us at TAFEQueenslandInternational@deta.qld.gov.au
2 Partnership Due Diligence | A Best Practice Guide

Industry Contributions
TAFE Queensland International wish to acknowledge the valuable insight of the registered training
organisations, consultants and other industry experts in international education that provided input into
this guide. These include:
Australian Council Private Education and Training (ACPET)
Australian Trade Training College (ATTC)
Brisbane North Institute of TAFE (BNIT)
CHARLTON BROWN®
Flight Training Australia
International Education Services (IES)
International Offshore Projects Unit – Queensland Department of Education, Training and Employment
Learning Network Queensland
Metropolitan South Institute of TAFE (MSIT)
Queensland Education and Training International (QETI) now known as International Education and Training
Unit within the Department of Employment, Economic Development and Innovation (DEEDI)
SkillsTech Australia
Southbank Institute of Technology
Strategic Legal Unit – Queensland Department of Education, Training and Employment
Study Cairns
Sunland Aviation
Susan Foster – Consultant
Trade and Investment Queensland
VET Resource Management Unit – Queensland Department of Education, Training and Employment
Partnership Due Diligence | A Best Practice Guide 3

Table of Contents
Acknowledgments 2
Disclaimer 2
For Further Contributions 2
Industry Contributions 3
Introduction 6
1.1 About the Guide 6
1.2 Aim of the Guide 6
1.3 The Approach 7
1.4 How to Use this Guide 7
SECTION ONE: CONTEXT OF THE GUIDE 10

1 Due Diligence 10
1.1 What is Due Diligence 10
1.2 Why is Due Diligence Conducted 10
1.3 When and how much due diligence should be conducted? 11
2 Due Diligence, International Engagement Models And Partners 12
3 Australian Regulatory Framework 14
3.1 Education Services for Overseas Students (ESOS) 14
3.2 Australian Quality Training Framework Standards 15
4 Snapshot Of Due Diligence Practices Within Queensland Vet Sector 16
SECTION TWO: PRINCIPLES OF DUE DILIGENCE 17

1 Principle One: Strategic Framework 18
1.1 Key Questions and Considerations 18
1.2 Sources of Information 19
2 Principle Two: Know Your Target Market 20
2.1 Considerations and Key Questions 20
Í 0RINCIPLEÍ4HREEÍÍ#ORPORATEÍ0ROjLEÍ
4 Principle Four: Legal Considerations 25
5 Principle Five: Financial Considerations 27
6 Principle Six: Organisational Considerations 30
7 The Risk Matrix 33

7.2 Resources 35
7.3 Other Considerations in International Engagement 35
7.4 Other Sources of Information 37
SECTION THREE: PROVIDER TEMPLATES 38

1. Due Diligence Process 38
2. Matrix of Home Institution Factors and Key Attributes of Ideal Partners 38
3. Sample Internal Due Diligence Checklist 39
4. Sample Provider Due Diligence Pack 43
5. Sample Environmental Analysis Form for Target Market 44
6. Sample Application for Consideration to be Appointed as an Education Agent 45
Í 3AMPLEÍ)NTERNATIONALÍ0ARTNERÍ0ROjLEÍ
8. Mobility Partner Checklist 51
9. Due Diligence Risk Analysis Matrix 53
APPENDICES
List of Acronyms 54

1. Introduction
1.1 About the Guide
Partnerships and collaborations are critical to the advancement of today’s international education and
training industry. With the recent downturn in inbound students, many providers are re-focusing their
efforts and re-aligning their strategic priorities to engage in international collaborations. Whilst partnering
with an overseas organisation can be advantageous it can also be a high risk activity. The Due Diligence
Best Practice Guide provides a robust, practical and strategic framework for VET providers. The importance
of a vigorous due diligence process cannot be overstated in the process of international partner selection.
Failure to conduct appropriate due diligence on a potential collaboration can expose your institution to
risks, ranging from a loss of a few students to loss of a whole market, or damage to your reputation and
branding as well as loss of Australian Quality Training Framework (AQTF) accreditation in Australia.
The Best Practice Guide is built around a Due Diligence Model that establishes a framework for providers
to adapt to their individual needs. The model is able to be tailored depending on a provider’s experience,
resources, the business opportunity being pursued and the international partnership being considered.
The process involves the consideration of six overriding principles of due diligence. It should be noted
that this Guide is just that, a guide, and it should be adapted to your needs. On completion of the
process, providers should have a thorough understanding of the risks and opportunities associated with
a particular partner and identify strategies to mitigate against those risks.
For providers there are many drivers for entering international partnerships. These may include:
r the opportunity to expand international networks
r BUILDÍONÍTHEIRÍINTERNATIONALÍPROjLE
r exchange ideas and practices
r improve the quality of their programs
r increase graduate opportunities and mobility experiences for students
r gain access to new markets and funding
r increase opportunities for staff development and expanding teachers’ international experiences.
Understanding the reasons and objectives for entering into partnership arrangements is crucial for
success.
1.2 Aim of the Guide

It is envisaged that this Partnership Due Diligence –Best Practice Guide be used as a tool for the Queensland
VET industry and the international education industry as a whole, in investigating the suitability and
sustainability of international partners over a range of international engagement activities.
3PECIjCALLYÍTHEÍOBJECTIVESÍOFÍTHEÍ'UIDEÍAREÍTO
r provide a clearer understanding of due diligence and why providers should conduct it
r provide a model that can be used to improve your organisation’s operations
r provide information and advice on how and where to collect due diligence data
r provide templates and resources to manage your due diligence research and outcomes.

1.3 The Approach
The project was developed in three key stages to ensure examples of good practice were captured and
tested against Australian and international standards. The following approach was used to inform its
development.
1.3.1 Phase One: Queensland, Australian and international desktop research

The desktop audit investigated the use of due diligence as an underlying business principle and its
SIGNIjCANCEÍ TOÍ INTERNATIONALÍ EDUCATIONÍ ANDÍ TRAININGÍ Í !LSOÍ CASEÍ STUDIESÍ WEREÍ IDENTIjEDÍ TOÍ HIGHLIGHTÍ THEÍ
risks and opportunities in following a robust due diligence process before committing to an international
partnership.
1.3.2 Phase Two: Interviews with targeted stakeholders in Australia

The second phase involved interviews with a number of stakeholders including those involved in
the promotion, strategy development and delivery of programs with international partners. See
acknowledgments for a list of interviewees. Every effort was made to include a large range of stakeholders
from government, TAFE and the private VET sector. A series of non-directional, open ended questions
were used to encourage participants to talk freely about the experiences and opinions in relation to due
diligence and international partnerships.
1.3.3 Phase Three: Report

4HEÍjNALÍSTAGEÍISÍTHEÍFOLLOWINGÍREPORTÍWHICHÍINCLUDESÍTHEÍOUTCOMESÍOFÍTHEÍDESKTOPÍAUDITÍASÍWELLÍTHEÍ@"ESTÍ
Practice Guide’. The resource has been prepared taking into account stakeholders’ needs as much as
possible. This document is not intended as a procedures manual but as a guide to equip providers with a
strategic tool to identify their needs from the potential partnership, the actual characteristics of potential
partners and enabling providers to highlight areas of risk and mitigate against those risks.
The provider should investigate each principle as appropriate depending on the type of business model
BEINGÍ INVESTIGATEDÍ THEÍ AMOUNTÍ OFÍ jNANCIALÍ INVESTMENTÍ ANDÍ THEÍ POTENTIALÍ RISKÍ TOÍ THEIRÍ ORGANISATIONÍ &ORÍ
example an offshore business model would require a more robust due diligence process than a straight
articulation model.
1.4 How to Use this Guide

In considering the due diligence processes for any international partnership, the following steps are
considered leading practice:
r establish desired partner characteristics
r assess partner suitability
r conduct structured and informed due diligence.
Step One: Establish desired partner characteristics

As outlined in Diagram 1: Due Diligence within a Strategic Framework, the establishment of partner
characteristics should be conducted within the strategic planning stage, before an opportunity arises.
However, if an opportunity arose unexpectedly it would still be worth considering the ideal partner so as to
establish a basis for you to conduct negotiations and mitigate against risk. The list of ideal characteristics
can also be considered as a check list when considering actual partners suitability.
r Consider your own strategic framework (Principle One, see Section Two). What are your strategic
objectives? Why are you pursuing a particular offshore activity?
r Research your target market (Principle Two, see Section Two). Analyse the political, economic, social,
technological, environmental and legal aspects of your target market.
r Establish a list of characteristics you are looking for in an ideal partner depending on your strategic
objectives and the market environment.

Desired partner characteristics will vary depending on the target market, the strategic motivation for
THEÍACTIVITYÍASÍWELLÍASÍAÍPROVIDERSÍPROjLEÍINÍTHATÍMARKETÍ+EYÍATTRIBUTESÍOFÍAÍSUITABLEÍPARTNERÍSHOULDÍBEÍ
established during the provider’s strategic planning process, and guided by not only strategic goals of
a provider but also existing Australian legislative quality assurance process. This will ensure a suitable
partner is selected.
Diagram 1: Due Diligence within a Strategic Framework
ORGANISATION STRATEGIC PLAN

STEP ONE: STEP TWO: STEP THREE:
Establish Ideal Partner Conduct Due Diligence Conduct Risk Assessment
Attributes
INTERNATIONAL
ORGANISATION PLAN
Financial Plan
Marketing Plan BUSINESS OPPORTUNITY
Organisational Plan
Concept Proposal
Business Case
MANAGING THE OPPORTUNITY

Contact / Agreement
Operational Plan Contract/Agreement
Operational Plan
Exit

Step Two: Assess Partner Suitability
a) Investigate potential partners’ characteristics by considering Principles Three to Six (see Section Two):
r #ORPORATEÍ0ROjLEÍ0RINCIPLEÍ4HREE Í#ONDUCTÍRESEARCHÍONÍTHEÍORGANISATIONALÍSTRUCTUREÍOFÍTHEÍCOMPANYÍ
current activities and agreements as well as the registration and domicile.
r Legal Considerations (Principle Four). Can the potential partner legally activate the agreement?
r &INANCIALÍ#ONSIDERATIONSÍ0RINCIPLEÍ&IVE Í#ONSIDERÍTHEÍjNANCIALÍPROBITYÍOFÍTHEÍCOMPANYÍASÍWELLÍASÍ
factors such as exchange rates and issues regarding remittance of money offshore.
r Organisational Considerations (Principle Six). What resources, infrastructure and policies and
procedures does the potential partner operate with? Do they have appropriately trained staff?
b) Use a variety of sources including the partners themselves, government agencies, international
networks, students and the internet to verify and triangulate data.
Step Three: Conduct a Risk Analysis

Once all due diligence investigation has been completed use the Risk Analysis Template in Section
4HREEÍTOÍSUMMARISEÍTHEÍjNDINGSÍANDÍPROVIDEÍTHEÍBASISÍFORÍAÍRISKÍASSESSMENTÍOFÍALIGNINGÍWITHÍAÍPARTICULARÍ
PARTNERÍÍ)NÍDOINGÍTHISÍYOUÍCANÍEASILYÍCOMPAREÍTHEÍIDEALÍCHARACTERISTICSÍIDENTIjEDÍINÍSTEPÍONEÍWITHÍTHEÍACTUALÍ
CHARACTERISTICSÍINDENTIjEDÍUNDERÍSTEPÍTWOÍ
9OURÍjNDINGSÍMAYÍBEÍCATAGORISEDÍAS
r Low risk where no further action is required.
r Medium risk where mitigating strategies are required. Depending on the risk these strategies might
include changing the business model to ensure risk management strategies are included within the
contract.
r High risk which may be deal breakers. These include risks that are considered too high to mitigate
against or information that arises that is outside your organisational strategic scope.
Other factors could also be considered on an individual organisational level.
This step will clearly identify your areas of risk in managing your international engagement activity.
Remember due diligence is about not only ensuring your partner is reputable but also ensuring that there
ISÍSTRATEGICÍALIGNMENTÍANDÍAÍMUTUALLYÍBENEjCIALÍOUTCOMESÍFORÍALLÍPARTIES

SECTION ONE
CONTEXT OF THE GUIDE
1 Due Diligence
1.1 What is Due Diligence
$UEÍ DILIGENCEÍ HASÍ BEENÍ DEjNEDÍ ASÍ fTHEÍ CAREÍ THATÍ AÍ PRUDENTÍ PERSONÍ MIGHTÍ BEÍ EXPECTEDÍ TOÍ EXERCISEÍ INÍ
the examination and evaluation of risks affecting a business transaction.”1 In the current context of
INTERNATIONALÍEDUCATIONÍDUEÍDILIGENCEÍISÍDEjNEDÍASÍ
Part of the risk management process by which an educational provider assesses the suitability of an international
partner and evaluates the business opportunity before signing a Memorandum of Understanding or a binding
contract.
1.2 Why is Due Diligence Conducted

The overriding purpose of due diligence is to gather as much available information as possible to analyse
and assess the risks and opportunities associated with the partnership. Information gathered should drive
the project business plan and allow providers to strategically consider a number of options including:
r WITHDRAWALÍFROMÍTHEÍCOLLABORATIONÍlÍIFÍTHEÍDUEÍDILIGENCEÍIDENTIjESÍHIGHÍRISKSÍSUCHÍASÍREPUTATIONALÍ
RISKSÍORGANISATIONALÍRISKSÍjNANCIALÍRISKSÍORÍRISKÍOFÍLEGISLATIVEÍNON COMPLIANCE
r adjustment to the business model and or operational model – a provider may reassess the value and
type of services being offered
r mitigate against the risk – it may be possible for the issue to be resolved or mitigated against before
jNALISINGÍTHEÍDEALÍORÍAGREEMENT
The reasons for conducting due diligence are not only to protect your organisation from reputational
damage, non-compliance issues and safety of staff and students, it is also to ensure that the potential
PARTNERÍISÍAÍGOODÍORÍSTRATEGICÍjTÍWITHÍYOURÍORGANISATIONÍ4HISÍWILLÍINCREASEÍTHEÍCHANCEÍOFÍSUCCESSÍASÍTHROUGHÍ
the due diligence process you will gain information that will assist in negotiating and clarifying roles,
responsibilities of each partner as well as the common objective of the activity.
It is important to take into consideration the cultural and business norms of the countries you are dealing
with and be sensitive to these. In many cultures the formal gathering of information can be seen as
fDISTRUSTtÍANDÍTHISÍCANÍDAMAGEÍTHEÍRELATIONSHIPÍBEFOREÍITÍEVENÍSTARTSÍ+EEPÍTHISÍINÍMINDÍWHENÍINVESTIGATINGÍ
and learning about your target market. Take into account the social and business etiquettes and the need
FORÍSOMEÍINTERNATIONALÍPARTNERSÍTOÍfSAVEÍFACEtÍ5NDERSTANDINGÍTHEÍCROSSÍCULTURALÍCOMMUNICATIONÍFORÍYOURÍ
target market will assist greatly in conducting the due diligence process and negotiating the project. In
many cultures it is not what is said but what is not said that remains an important point. Effective cross
cultural communication is learnt from experience, so ensure that you have an appropriate person, within
your organisation dealing with the international partner. For resources and learning more about cross
cultural communication refer to the resources section of the knowing your target market.
1 Due Diligence.Dictionary.com. Merriam-Webster’s Dictionary of Law. Merriam-Webster, Inc. http://dictionary.reference.com/

browse/Due Diligence (accessed: August,2011).

1.3 When and how much due diligence should be conducted?
For the purpose of this guide due diligence has been restricted to data gathered before a business arrangement
HASÍBEENÍjNALISEDÍ$IAGRAMÍÍINÍ)NTRODUCTIONÍILLUSTRATESÍWHENÍDUEÍDILIGENCEÍWOULDÍBEÍCONDUCTEDÍWITHINÍAÍ
typical strategic framework.
A robust due diligence process will not be successful unless you have a thorough understanding of your
organisational strategic objectives, knowledge of the international industry environment within Australia
ANDÍHOWÍYOURÍORGANISATIONÍjTSÍWITHINÍTHEÍSECTORÍ)TÍISÍALSOÍNECESSARYÍTOÍHAVEÍESTABLISHEDÍINTERNALÍPOLICIESÍ
and procedures as well as knowledge of the market in which the international partner is operating.
Working within a strong strategic foundation allows a whole-of-organisation approach to the business deal
or agreement including:
r clear strategic objectives as to which international engagement models are being pursued
r clear strategic objectives as to why the particular international engagement models are being pursued
r strong and clear understanding of compliance requirements both within Australia and within the
offshore market
r ENSURINGÍSUFjCIENTÍANDÍAPPROPRIATEÍjNANCIALÍANDÍHUMANÍRESOURCESÍTOÍESTABLISHÍANDÍMANAGEÍEACHÍ
international engagement activity
r ESTABLISHÍ@DEALÍBREAKERSÍORÍEXITÍSTRATEGIESÍBASEDÍONÍTHEÍSTRATEGICÍOBJECTIVES
r mitigation against as many risks as possible by market familiarisation.
/NCEÍYOUÍHAVEÍESTABLISHEDÍTHEÍSTRATEGICÍFRAMEWORKÍANDÍIDENTIjEDÍSTRATEGICÍOPPORTUNITIESÍTHENÍDUEÍDILIGENCEÍ
OFÍTHEÍSPECIjCÍPARTNERÍCANÍBEÍCONDUCTEDÍWITHINÍTHATÍCONTEXTÍ)NFORMATIONÍGATHERINGÍONÍAÍPOTENTIALÍPARTNERÍ
should commence as soon as the business opportunity presents itself, through the negotiations and before
the signing of a Memorandum of Agreement or a binding document. Due diligence in the form of monitoring,
review and audit would then take place during the life of the agreement.
When conducting due diligence it is important to balance the need for information and the relationship you
are developing. Information should be collected in a non-confrontational way. The term due diligence might
be seen as a form of distrust. A couple of suggestions in doing this are below:
r offer your partner an information pack from your organisation which includes all data they might
require to collect to conduct their own due diligence
r when collecting information directly from your partner send them a template which is not called a
DUEÍDILIGENCEÍFORMÍBUTÍSOMETHINGÍSUCHÍASÍANÍ)NTERNATIONALÍ0ARTNERÍ0ROjLEÍ&ORMÍORÍ!GENTÍ-ANAGEMENTÍ
Application Form (see Section Three: provider templates)
r keep communication open and be clear that this information is required in order to ascertain
COMPLIANCEÍISSUESÍWITHINÍ!USTRALIAÍANDÍTOÍENSUREÍTHATÍTHEÍOPPORTUNITYÍISÍAÍGOODÍSTRATEGICÍjTÍANDÍ
MUTUALLYÍBENEjCIALÍFORÍBOTHÍORGANISATIONS
The amount of due diligence required differs depending on the international engagement model, risks
TOÍYOURÍORGANISATIONÍYOURÍPRIORÍEXPERIENCESÍINÍTHEÍMARKETÍTHEÍjNANCIALÍVALUEÍOFÍTHEÍBUSINESSÍDEALÍTIMEÍ
constraints and resources available. For example, if a provider was investigating the possibility of opening
an offshore campus a considerable amount of time would be spent on due diligence. This approach is
opposed to the negotiation of a twining arrangement where the risk may be contained to reputational and
ASSOCIATEDÍRISKSÍRATHERÍTHANÍjNANCIALÍ4HESEÍRISKÍFACTORSÍSHOULDÍBEÍTAKENÍINTOÍACCOUNTÍWHENÍGATHERINGÍYOURÍ
due diligence data. A low risk model might only require data being gathered from one or two sources. In
contrast, a high risk model where the consequences are reputational damage, loss of accreditation and or
LARGEÍjNANCIALÍCOMMITMENTÍMIGHTÍTAKEÍMUCHÍLONGERÍANDÍREQUIREÍSUBSTANTIALÍDUEÍDILIGENCEÍFROMÍAÍVARIETYÍOFÍ
sources within Australia and overseas.

2 Due Diligence, International Engagement Models And Partners
VET has a long tradition in international education activities including the recruitment of students inbound,
consultancy services, corporate training, aid and development projects, transnational delivery and online
training. Due diligence is an essential element of all international engagement activities and should be
conducted when partnering with any international organisation.
)NTERNATIONALÍ ALLIANCESÍ INÍ EDUCATIONÍ CANÍ VARYÍ SIGNIjCANTLYÍ DEPENDINGÍ ONÍ THEÍ TYPEÍ OFÍ ARRANGEMENTÍ THEÍ
motivations for partnering, responsibilities and obligations within the arrangement as well as the risk each
partner holds.
Examples of possible partner organisations include: educational institutions, companies, silent investors,
governmental bodies, international education agents and industry partners. It can be argued however that
no matter what form the alliance takes, the main motivation for Australian providers to collaborate with
an overseas partner is to have access to local knowledge, understanding of the target market and to work
with a like-minded international with alignment of strategic goals. Other perceived advantages include:
r expanding into new markets
r BUILDINGÍINTERNATIONALÍPROjLE
r sourcing of international inbound students
r globalising of students
r globalising of staff
r GENERATINGÍREVENUEÍWITHÍSHAREDÍjNANCIALÍRISK
Whilst a suitable partnership can establish the provider in a strong strategic position within a particular
market, conversely an unsuitable partner can damage market potential both overseas and domestically.
(IGHÍ RISKÍ ENGAGEMENTÍ MODELSÍ SUCHÍ ASÍ THEÍ DELIVERYÍ OFÍ !USTRALIANÍ ACCREDITEDÍ QUALIjCATIONSÍ OVERSEASÍ
(transnational delivery), if not managed carefully, can impact negatively on a provider’s accreditation and
operations in Australia. Other international engagement activities such as outbound mobility may have
LOWÍ LEVELSÍ OFÍ jNANCIALÍ ANDÍ CONTRACTUALÍ RISKÍ HOWEVERÍ THEYÍ REQUIREÍ SPECIALÍ CONSIDERATIONÍ WITHÍ RESPECTÍ TOÍ
student safety when conducting programs in countries around the world.
The challenge is to select a partner who can maximise the opportunities for a provider whilst minimising the
risks associated with the international engagement activity. As there is no one type or entity that dissolves
all risks, each partner should be assessed individually within the context of the activity being explored.
Table 1 summarises the different international engagement models, the kinds of international partnerships
an Australian provider might work with to facilitate the engagement and possible areas of focused due
diligence.

Table 1: Due Diligence Approaches by International Engagement Models
Engagement Activity Possible Partners Due Diligence Focus Further Resources
Inbound Students International Strategic International Education Agent Management –

education agents framework A Best Practice Guide for the Qld VET Sector.
Local educational Research of local http://training.qld.gov.au/information/tafe-
provider market qld-international/best-practice-guides.html
Scholarship bodies #ORPORATEÍPROjLE ISANA – Education Agents Manual
Organisational IUUQXXXJTBOBPSHBVkMFT
considerations EducationAgentsManual.pdf
Victorian TAFE International (VTI) – Best
Practice in Education Agent Management
http://www.vti.edu.au/images/stories/
pdfs/VTI-Best-Practice-in-Education-Agent-
Management.pdf
Transnational Partnership broker Strategic National Quality Council – Good Practice Guide
Education framework for VET Offshore Delivery
Government
Research of local http://www.nqc.tvetaustralia.com.au/__data/
Local educational
market BTTFUTQEG@kMF(PPE@1SBDUJDF@
providers
Guide_for_Offshore_VET_Delivery.pdf
#ORPORATEÍPROjLE
Industry
Supervision and Moderation for Offshore
Legal
Delivery: VTI Guide to Good Practice in
considerations
Transnational Education. A Discussion Paper
Financial
http://www.vti.edu.au/
considerations
Good Practice in Offshore Delivery: A Guide for
Organisational
Australian Providers of Education and Training
considerations
http://export.business.vic.gov.au/__data/
BTTFUTQEG@kMF5/&@(PPE@
Practice_Guide_2008_pdf.pdf
Quality Assurance of Offshore Delivery
http://www.austrade.gov.au/cmlogin.aspx?
RedirectURL=http%3a%2f%2fwww.austrade.
gov.au%2fArticleDocuments%2f3529%2f
QA_NCVERReport_2007.pdf.aspx
Consultancy Partnership broker Strategic alignment

Government Research of local
agencies market
Local educational #ORPORATEÍPROjLE
providers
Industry

Engagement Activity Possible Partners Due Diligence Focus Further Resources
Study Tours International Strategic Useful Information for Schools on Study Tours
education agents framework
http://www.eqi.com.au/useful-information/
Government Research your for-schools.html
agencies target market
Local educational #ORPORATEÍPROjLE
providers
Organisational
Industry considerations
Outbound Mobility Industry Strategic VET Sector Outbound Mobility Manual and
framework Tool Box
Local educational
providers Research your http://www.studyoverseas.gov.au/
target market vetmobility/2-Project-Background.html
.OTÍFORÍPROjTÍ
organisations #ORPORATEÍPROjLE Queensland Outbound Mobility Best Practice
Organisational Guide
considerations http://training.qld.gov.au/information/tafe-
qld-international/best-practice-guides.html
3 Australian Regulatory Framework

Australian VET providers operate within a number of legislative and regulatory frameworks, examples of
these include:
r !USTRALIANÍ1UALIjCATIONSÍ&RAMEWORKÍ!1&
r Australian Quality Training Framework (AQTF) Standard
r National Vocational Education and Training Regulator Act 2011
r Education Services for Overseas Students (ESOS) Act 2000
r The National Code (2007)
These regulations establish requirements for VET and educational providers who offer services to
international students within Australia, manage educational agent partnerships and offer Australian AQTF
ACCREDITEDÍQUALIjCATIONSÍOFFSHOREÍ7HENÍCONDUCTINGÍDUEÍDILIGENCEÍPARTICULARÍATTENTIONÍSHOULDÍBEÍGIVENÍTOÍ
ensuring compliance where appropriate to each legislative framework.
3.1 Education Services for Overseas Students (ESOS) Act 2000 and the
National Code (2007)
The ESOS Act and The National Code specify that due diligence, to some extent, must be conducted on
educational agents whether they are based onshore or offshore.
POLICY
Standard 4 of the National Code (2007) – Education Agents

Registered providers take all reasonable measures to use education agents that have an appropriate knowledge
and understanding of the Australian international education industry and do not use education agents who are
dishonest or lack integrity.

3.2 Australian Quality Training Framework Standards
4HEÍ !USTRALIANÍ 1UALITYÍ 4RAININGÍ &RAMEWORKÍ 3TANDARDSÍ !14& Í ANDÍ ASSOCIATEDÍ !USTRALIANÍ 1UALIjCATIONSÍ
&RAMEWORKÍ!1& ÍSTIPULATEÍTHEÍREQUIREMENTSÍANDÍOBLIGATIONSÍFORÍTHEÍDELIVERYÍANDÍQUALIjCATIONÍISSUANCESÍ
OFÍACCREDITEDÍQUALIjCATIONSÍ4HESEÍAREÍRELEVANTÍFORÍPROVIDERSÍWHETHERÍTHEYÍAREÍDELIVERINGÍINÍ!USTRALIAÍORÍ
OVERSEASÍ4OÍDATEÍAUDITÍANDÍQUALITYÍASSURANCEÍOFÍACCREDITEDÍ!USTRALIANÍQUALIjCATIONSÍHAVEÍBEENÍCONDUCTEDÍ
on a State and Territory basis and involved desktop audits only of providers’ offshore operations. Under
the Standards a provider is only required to inform the State and Territory regulatory body of changes in
THEIRÍOPERATIONSÍINCLUDINGÍCOMMENCINGÍOFFSHOREÍDELIVERYÍOFÍAÍQUALIjCATIONÍÍ
2ECENTLYÍ THEÍ .ATIONALÍ 6OCATIONALÍ %DUCATIONÍ ANDÍ 4RAININGÍ 2EGULATORÍ !CTÍ Í HASÍ BEENÍ RATIjEDÍ BYÍ THEÍ
Australian government. This legislation empowers the newly established Australian Skills Quality Authority
(ASQA) to use regulatory tools such as audits to gather information and data about the operations of RTO’s
both onshore and offshore.
POLICY
Audits can range from desktop research to site visits, including local, interstate and overseas operations. During
an audit, information may be sourced from the RTO itself, its students, industry international, ASQA’s compliance
systems (such as the complaints register), and other risk analysis systems.
According to the ASQA website (http://www.asqa.gov.au/about-asqa/regulatory-approach/risk.html)

each RTO will be assigned a risk rating on the basis of a number of indicators including: Performance,
'OVERNANCEÍANDÍ0ROjLEÍ)TÍSHOULDÍBEÍNOTEDÍTHATÍ0ROjLEÍRELATESÍTOÍÍPERÍCENTÍOFÍWEIGHTINGÍANDÍINCLUDESÍ
factors such as
r scope of registration
r range of industry training areas and/or AQF levels delivered
r proportion of delivery of training that leads to licensed or regulated outcomes
r proportion of delivery to overseas students in Australia
r proportion and range of delivery at offshore locations
r modes of delivery and types of student clients.
This suggests that providers involved in international engagement models such as transnational education,
RECRUITMENTÍOFÍINBOUNDÍSTUDENTSÍANDÍTHEÍDELIVERYÍOFÍNON AWARDÍQUALIjCATIONSÍOFFSHOREÍWILLÍBEÍASSIGNEDÍ
a risk rating with these factors taken into account. Due diligence becomes imperative, not only from a
reputational risk in the market but also loss of accreditation in Australia.
To assist in ensuring quality and compliance of offshore operations, the National Quality Council (NQC)
in 2011 developed a number of resources including issues papers and a Good Practice Guide to support
providers in assessing risk and managing their offshore operations:
r National Quality Council (NQC): Issues Paper Challenges and Risks for the Future of Offshore VET
$ELIVERYÍ*ULYÍ2
r .ATIONALÍ1UALITYÍ#OUNCILÍ.1# Í'OODÍ0RACTICEÍ'UIDEÍFORÍ/FFSHOREÍ6%4Í$ELIVERYÍlÍ*ANUARYÍ3
Í HTTPWWWNQCTVETAUSTRALIACOMAU??DATAASSETSPDF?jLE.1#?/FFSHORE?6%4?)SSUES?0APERPDF
3 http://www.nqc.tvetaustralia.com.au/__data/assets/pdf_file/0008/55349/Good_Practice_Guide_for_Offshore_VET_
Delivery.pdf

4 Snapshot Of Due Diligence Practices Within
Queensland Vet Sector
Findings from the stakeholder interviews as well as desktop research indicate that current due diligence
PROCEDURESÍ WITHINÍ THEÍ !USTRALIANÍ INTERNATIONALÍ EDUCATIONÍ INDUSTRYÍ ANDÍ MOREÍ SPECIjCALLYÍ WITHINÍ THEÍ6%4Í
industry vary and are dependent on a number of factors including:
r the types of international engagement activities being considered
r maturity and experience of the provider in the international education industry
r size of the international organisation
r internal capability including, resources and knowledge
r time constraints.
The most common reasons cited for conducting due diligence on a potential international partner were
TOÍMITIGATEÍAGAINSTÍjNANCIALÍANDÍREPUTATIONALÍRISKÍ/FÍTHOSEÍPROVIDERSÍWHOÍDIDÍCONDUCTÍFORMALINFORMALÍ
DUEÍDILIGENCEÍONÍPARTNERSÍMOSTÍADVISEDÍTHATÍTHEYÍWEREÍILLÍEQUIPPEDÍTOÍASKÍTHEÍRIGHTÍQUESTIONSÍORÍjNDÍTHEÍ
answers given resources, time constraints and knowledge.
On the basis of stakeholder interviews and the desktop audit it has been established that:
r VET providers are at various stages of maturity in regards to internationalisation
r there are a number of models of international engagement being pursued within the industry
r the types of entities and international providers’ partner differ greatly
r due diligence activities are inconsistent within the industry
r due diligence has become more common with legislative changes and an increasing focus of
compliance on offshore operations
r the industry as a whole is more focused on risk management and mitigation at all levels and types of
activities.
Taking these factors into account, Section Two of the Best Practice Guide provides advice on suggested
Principles of Due Diligence. It is important to note that the guide is not meant to be used as a procedure
manual but as a framework which providers can adapt depending on the international engagement model
THEYÍAREÍPURSUINGÍTHEÍRISKSÍASSOCIATEDÍWITHÍTHEÍMODELÍTHEIRÍEXPERIENCEÍINÍTHEÍMARKETÍASÍWELLÍASÍTHEÍPROjLEÍ
and experience of the potential international partner. It is essential for providers to ensure that they keep
clear records indicating that they have conducted due diligence on international partners, not only for
compliance but also as tools for ongoing review and strategic planning purposes.

SECTION TWO:
PRINCIPLES OF DUE DILIGENCE
Diagram 2: Due Diligence Framework and Principles
STEP ONE STEP TWO STEP THREE

Identify Ideal Partner Conduct Due Diligence Conduct Risk Analysis
Attributes
PRINCIPLE ONE: PRINCIPLE THREE: LOW RISK:

Strategic Framework #ORPORATEÍ0ROjLE No Further Action
Required
PRINCIPLE TWO: PRINCIPLE FOUR:
Research Your Legal Considerations MEDIUM RISK:
Target Markets Develop Mitigating
Strategies
PRINCIPLE FIVE:
Financial Considerations
HIGH RISK:
Deal Breakers
PRINCIPLE SIX:
Organisational
Considerations

Attributes
1 Principle One: Strategic Framework

It is essential that due diligence be conducted within a strong strategic framework (as outlined in Diagram
1 page 8). Before looking at the suitability of a particular partner it is highly recommended that a clear
understanding of a provider’s international objectives, operating environment and strategic activities in
regards to the objectives be analysed and clearly stated within a strategic framework. This establishes a
transparent document adopted by the institution as a whole which will drive successful projects.
It is at this point the international engagement models a provider is going to focus on and the kinds of
INTERNATIONALÍPARTNERSHIPSÍSHOULDÍBEÍIDENTIjEDÍÍ+EYÍATTRIBUTESÍFORÍTHEÍIDEALÍPARTNERSÍINÍAÍPARTICULARÍMARKETÍ
attached to each model should start to be gathered.
Please refer to Table 1 (page 13) for international engagement models and the types of partnerships a provider
might develop. For example in recruitment of inbound students a provider might identify international
education agents who have certain networks, skills and services as ideal partners in a particular market.
1.1 Key Questions and Considerations

The following factors should be considered.
r Is your international plan driven by your organisational strategic plan?
r Has an international environmental assessment been conducted to investigate internal and external
operating climate and establish your organisation’s Strengths, Weaknesses, Opportunities and
Threats?
r Does your international plan clearly indicate your vision and strategic activities, for example your
OBJECTIVESÍORÍMOTIVESÍFORÍPURSUINGÍINTERNATIONALÍENGAGEMENTÍMODELSÍINÍSPECIjCÍTARGETÍMARKETS
r (AVEÍSUFjCIENTÍjNANCIALÍANDÍHUMANÍRESOURCESÍBEENÍDEDICATEDÍINÍPURSUITÍOFÍSTRATEGICÍACTIVITIES
r Are unforeseen opportunities still being considered and assessed on the basis of their strengths and
LONGÍTERMÍVIABILITYÍÍ(AVEÍADDITIONALÍRESOURCESÍBEENÍALLOCATEDÍTOÍjNANCEÍUNFORESEENÍOPPORTUNITIESÍ
should they arise?
r Has the international plan received executive support, been approved internally and being
approached collaboratively by the whole organisation?
r Does your staff have a clear understanding of what goals and objectives are being pursued in each
international engagement activity?
r Do you have appropriate staff with the right skills, cultural knowledge and understanding to manage
the international engagement models?
r Which international engagement models are best suited to which target markets?

1.2 Sources of Information
Types of Resources Links Types of Information
Internal strategic documentation Organisational Strategic Plans

Historical International Plans
Minutes Of Board Meetings
Historical operating experience of Internal Student Statistics

organisation through staff knowledge and Successful Past International
internal documentation Strategies
Unsuccessful International Strategies
Industry seminars and workshops http://www.austrade.gov.au/Export- Austrade workshops

Events
http://www.ieaa.org.au/content/?id International Education Association

s=ProfessionalDevelopment of Australia (IEAA) workshops
http://www.aiec.idp.com/home. Australian International Education

aspx Conference (AIEC)
http://www.acpet.edu.au/events/ ACPET conference/workshops

pd-program
http://www.aiex.com.au/education- AIEX
training/short-courses-workshops
Federal Government Business Portal www.business.gov.au Tools For Business And Strategic
Planning
Austrade www.austrade.gov.au Information Regarding The

International Education Industry
Key Markets
Competitor Analysis
Student Numbers
,INKSÍ4OÍ/FFSHOREÍ/FjCESÍ
Trade and Investment Queensland http://www.export.qld.gov.au/ Advice And Resources On Exporting

skills-development.html For Queensland Based Organisations
Australian Institute of Export (AIEX) http://www.aiex.com.au/ Provides Advice, Resources And

Seminars Providing Advice About
Export
Australian Education International (AEI) www.aei.gov.au Government to government

partnerships
Commonwealth Register of
Institutions and Courses for Overseas
Students (CRICOS)
#OUNTRYÍ%DUCATIONÍ0ROjLESÍ#%0
International regulatory Information

Case Study: Ensuring a Good Strategic Fit
!ÍSMALLÍfONEÍMANÍBANDtÍ6%4ÍPROVIDERÍWASÍCONSIDERINGÍENGAGINGÍINÍTRANSNATIONALÍDELIVERYÍOFÍTHEIRÍPROGRAMSÍ
because they believed that it would be cheaper to deliver offshore than in Australia. They thought that they
would be able to reduce their overheads and capital expenditure by partnering with a local business to cut down
@THEÍREDÍTAPEÍREDUCEÍLABOURÍCOSTÍGETÍCHEAPÍRENTSÍANDÍHAVEÍAÍREADYÍACCESSÍTOÍFULLÍFEEÍPAYINGÍSTUDENTSÍCOMPAREDÍ
to their operations in Australia. The provider was approached by a potential partner based in South East Asia.
)NITIALÍCORPORATEÍANDÍORGANIZATIONALÍDUEÍDILIGENCEÍINDICATEDÍTHATÍTHEÍPARTNERÍWASÍAÍGOODÍjTÍFORÍAÍTRANSNATIONALÍ
education delivery partner. However, in researching the market, conducting negotiations with the potential
partner, and investigating the RTO’s compliance requirements in Australia the cost analysis showed that delivery
would actually be more expensive. Although overheads for conducting training offshore were cheaper the costs
associated with training the local partner, ensuring compliance and embedding quality controls were considerably
more expensive than Australia. Also they had not taken into account that the market overseas could not pay at the
SAMEÍRATEÍASÍTHEÍ!USTRALIANÍMARKETÍ4HEÍ24/ÍCONCLUDEDÍTHATÍFROMÍAÍjNANCIALÍANDÍCOMPLIANCEÍRISKÍPERSPECTIVEÍTHEÍ
engagement model was not sustainable.
2 Principle Two: Know Your Target Market

Knowledge of the target market include market features, the political, legal, educational environment,
as well as the providers’ exporting strengths and weaknesses. Knowledge is also required with regard
to potential students, programs and cross cultural aspects of your potential partner. This information is
essential to provide a good foundation for due diligence and offshore partnering. Market goals should be
ESTABLISHEDÍANDÍYOURÍLISTÍOFÍKEYÍATTRIBUTESÍFORÍYOURÍIDEALÍPARTNERÍSHOULDÍBEÍjNALISEDÍ
Apart from the environmental analysis of the target market particular attention should be paid to building
knowledge of cultural, business and social etiquette within the country. Doing business in countries with
very different cultural perspectives can be deemed to be a higher risk than doing business with a country
with similar social and cultural values. It is essential that you as a provider ensure you have the right staff
internally working with potential partners from these countries - people who have experience in working
across borders and communicating across cultures.
2.1 Considerations and Key Questions

r $EjNEÍANDÍUNDERSTANDÍTHEÍMARKETÍ ÍBEÍAWAREÍOFÍTHEÍPOLITICALÍSOCIALÍANDÍECONOMICÍFACTORSÍOPERATINGÍ
in-country that could affect the success of a transnational strategy and/or and the selection of your
international partner.
r Is the operating environment susceptible to instability including terrorism, political and civil unrest,
occupational, health and safety issues that will affect on-shore activities?
r What is your positioning concept for this market? Which international engagement activities would
you consider for this market?
r Know your target, in-market, clientele including age, demographic patterns, buying patterns and
customer type.
r Consider Government and regulatory environment including accreditation requirements of education
providers in the country and policies on foreign educational providers’ operations.
r How will the international accreditation and compliance requirements impact on your domestic
compliance requirements?
r Competitor analysis - who are your major competitors? What impact do they have on your strategic
objectives? In what areas does your organisation have the competitive advantage?
r Consider cultural factors including business etiquette, corruption index, work ethic, religion. How will
these factors affect your in-country activities?

r In considering cultural factors, do you have access to staff who fully understand the cultural
COMPONENTSÍTHATÍMIGHTÍINkUENCEÍTHEÍDUEÍDILIGENCEÍPROCESSÍANDÍTHEÍMANAGEMENTÍOFÍTHEÍINTERNATIONALÍ
engagement model?
r Visit the market to get a clear understanding of the key issues. Ensure the right staff members are
visiting the market to get the best information possible.

Types of resources and links Types of information
Staff knowledge of market from marketing visits Reports On Overseas Travel

Interviews
Historical operating experience of organisation within market Internal Student Statistics

Successful Past International
Strategies
Unsuccessful International Strategies
Industry Seminars and Workshops
http://www.austrade.gov.au/Export-Events Austrade Workshops
http://www.ieaa.org.au/content/?ids=ProfessionalDevelopment IEAA Workshops
http://www.aiec.idp.com/home.aspx AIEC
http://www.acpet.edu.au/events/pd-program ACPET Conference/Workshops
http://www.aiex.com.au/education-training/short-courses-workshops Australian Institute of Export
In-country educational agents and representatives Trends in market place

Opportunities
http://www.pieronline.org/qeac/default.aspx Potential partners
Trade and Investment Queensland Resources and tools to support

business looking at exporting their
services
http://www.export.qld.gov.au/
-ARKETÍSPECIjCÍREPORTS
)NÍMARKETÍREPRESENTATIVESOFjCES

Types of resources and links Types of information
AEI Government to Government

international partnerships
www.aei.gov.au
CRICOS
#OUNTRYÍ%DUCATIONÍ0ROjLESÍ#%0
International Regulatory Information
Student Mobility
Austrade International Student statistics

www.austrade.gov.au Export advice
For further links on market information see Austrade: -ARKETÍPROjLES
http://www.austrade.gov.au/Market-research-MR/default.aspx Information about EMDG grants
In country representative and advice
Department of Foreign Affairs and Trade #OUNTRYÍ3PECIjCÍ)NFORMATIONÍ

www.dfat.gov.au Travel Warning
Information On Government To
Government Activities And Relations
Organisation for Economic Cooperation and Development #OUNTRYÍSPECIjCÍINFORMATIONÍlÍ

demographics, political, social, work
www.oecd.org
force
In-country government websites for example: Government policies, general country

statistics Educational policies
Chinese Government website: http://english.gov.cn
UAE Governmental website: http://www.moe.gov.ae/english/pages/
default.aspx
Indian Government website: http://www.education.nic.in/
The Asian Development Bank Offers good market information on its

members
www.adb.org
Cross Cultural Communication resources Tips for cross cultural communication

http://www.schulersolutions.com/cross_cultural_communication.html
Transparency International Corruption Index

http://www.transparency.org/

Identify Ideal Partner Conduct due Diligence Conduct Risk AnalysiS
Attributes
1SJODJQMF5ISFF$PSQPSBUF1SPkMF
7HENÍ AÍ POTENTIALÍ BUSINESSÍ OPPORTUNITYÍ ARISESÍ WHICHÍ EITHERÍ jTSÍ NEATLYÍ INTOÍ THEÍ STRATEGICÍ OBJECTIVESÍ ANDÍ
motives stated in the international and organisational plans or is too good an opportunity to miss then
due diligence on the partner should commence immediately. If as part of the strategic planning process a
list of key attributes of an ideal partner has been developed then this should be used as a checklist. The
initial investigations should look at governance and the corporate structure of an organization. This check
should include information gathering regarding the partner’s reputation and experience in delivery and/or
marketing of Australian education programs.
In all international engagement activities it is important to collect all relevant information to ensure you
have a complete picture of the potential collaborating partner. If you are dealing with a foreign government
agency or public provider the relevant information will be easier to collect in comparison to a foreign owned
private company such as industry providers, educational agents or private educational providers.
In the case of privately held enterprises you should consider the consequences of the company being sold
ORÍCHANGINGÍHANDSÍASÍTHISÍMIGHTÍAFFECTÍTHEÍOUTCOMEÍOFÍTHEÍBUSINESSÍOPPORTUNITYÍORÍYOURÍSPECIjCÍDEALINGSÍ
with that partner.
7HENÍINVESTIGATINGÍTHEÍCORPORATEÍPROjLEÍOFÍYOURÍPOTENTIALÍPARTNERÍTAKEÍINTOÍCONSIDERATIONÍCULTURALÍISSUESÍ
)TÍMAYÍNOTÍBEÍAPPROPRIATEÍTOÍSENDÍAÍFORMÍFORÍYOURÍPARTNERÍTOÍjLLÍOUTÍASÍTHISÍMAYÍBEÍCONSTRUEDÍASÍOFFENSIVEÍ
)NÍTHEÍCASEÍOFÍCORPORATEÍPROjLEÍOFÍINTERNATIONALÍEDUCATIONÍAGENTSÍITÍISÍTHEÍNORMÍFORÍANÍAPPLICATIONÍFORMÍ
to be completed and the corporate information to be shared using this channel. However, in the case of
DEALINGÍWITHÍHIGHÍRANKINGÍOFjCIALSÍ6ICEÍ0RESIDENTSÍANDÍ#%/SÍITÍISÍSOMETIMESÍMOREÍRESPECTFULÍTOÍCONDUCTÍ
corporate due diligence face to face, CEO to CEO. This builds the relationship and avoids losing face for the
international partner in some circumstances.
If a form is unavoidable it is suggested that the naming of the form is sensitive to cultural differences and
ISÍNAMEDÍANÍ)NTERNATIONALÍ0ARTNERÍ0ROjLEÍ&ORMÍASÍOPPOSEDÍTOÍAÍ$UEÍ$ILIGENCEÍ&ORMÍ)TÍISÍALSOÍADVISABLEÍTOÍ
offer corporate information on your organisation without being asked so that the international partner can
conduct their own due diligence.

The following factors should be considered:
r The legal name of the company as well as names and details of the ownership structure of all
companies in the group
r The domicile of the company
r 'OVERNANCEÍANDÍMANAGEMENTÍCHARTÍINCLUDINGÍNAMESÍQUALIjCATIONSÍANDÍDETAILSÍOFÍSENIORÍEXECUTIVESÍ
and managers and relationship of other entities to the principal
r Some providers refer to the ESOS Act in establishing the credibility of international partners
SPECIjCALLYÍWHETHERÍTHEÍPARTNER
o has been convicted of an offence, or
o has ever had their registration cancelled or suspended under the ESOS Act, or
o has ever had a condition imposed on its registration
o has ever become bankrupt
o HASÍEVERÍBEENÍDISQUALIjEDÍFROMÍMANAGINGÍCORPORATIONSÍUNDERÍTHEÍ#ORPORATIONSÍ,AWÍOR
o has been involved in the provision of programs by another provider who is covered by the above
paragraphs at the time of any of the events that gave rise to prosecution of other action.
r Is the potential partner aligned to a particular government or party that may be politically risky?
r Reputation in terms of peer and client reputation?
r All agreements which may limit any company in the Group’s ability to engage in potential partnership
r Experience in education? Knowledge and experience of Australia’s quality assurance framework.
r Main business, product and clients?
r Strategic motivations, visions, goals?
r All relevant accreditations, licenses, compliance with international standards (ISO’s) and approvals?
r Consider the implications of partnering given providers current activities in the market. Will the
potential partnership adversely affect other activities?

Types Of Resources And Links Types Of Information
Information from potential partner Accreditations

NB: Data should be gathered from other sources to back up the potential Governance
partners claims.
Probity
Strategic Documents
Marketing propaganda published by the partner
In-country educational representatives Reputation of the potential partner

from a market perspective
AEI Accreditation requirements

www.aei.gov.au Access to other sources of
information
Use government networks to
research potential partner from
within.
Austrade
www.austrade.gov.au
Trade and Investment Queensland Resources and tools to support

business looking at exporting their
http://www.export.qld.gov.au/
services
In-country networks including agents, academic peers and associates should be

utilised in gathering information data on the target market.

Types Of Resources And Links Types Of Information
Internet search of the potential partner All publicly available information

from the internet
Companies that conduct individual due diligence Lawyers

Consulting Firms For example KPMG,
Australian Government Solicitors,
Price Waterhouse Coopers (PWC),
Local market companies that
specialise in due diligence
3EARCHÍOFÍLOCALÍ-EDIAÍ.EWSPAPERSÍANDÍ*OURNALÍREPORTS
Case Study: CEO to CEO Corporate Due Diligence
In conducting corporate due diligence, an Australian VET provider has embedded a meeting of senior executives
of both partners into their due diligence processes. In doing this the provider ensures that a strong strategic
alignment is established, build CEO to CEO partnership and ensure that the project is supported at the highest
level. This is also an opportunity for the CEO to commence due diligence informally which is recorded through
a site report and provides the foundation to continue negotiations and further due diligence by other staff
members. This strategy whilst effective at establishing the partnership within the Australian provider’s strategic
framework needs to be followed up by other staff members such as trainers and administrators.
4 Principle Four: Legal Considerations

4HEÍ MAJORITYÍ OFÍ INTERNATIONALÍ ALLIANCESÍ AREÍ CONjRMEDÍ EITHERÍ THROUGHÍ AÍ -EMORANDUMÍ OFÍ 5NDERSTANDINGÍ
or a contract. It is standard practice to include dispute resolutions within the agreement. In most cases
should the dispute resolution fail legal recompense would not be an option due to the viability of taking
an international partner to court. It is therefore important to conduct a number of probity checks to ensure
(as much as possible) that the potential partner is a legitimate, honest organisation.
It is also important in the case of high risk activities such as transnational education that you check what
your rights, obligations and protection of IP and the like is in the market.
When assessing educational agent due diligence some countries may have strict legislative guidelines
surrounding who can operate as an education agent. China is the obvious example of this.

r Have a clear understanding of the legal entity, governance structure.
r Do they have the authority to activate the intentions of the partnership? This would be realised
through a clear understanding of the regulatory environment in the target market.
r Where is the company/organisation registered? Is it within the target market or another country?
What are the implications?
r Ask for disclosure of any information involving breaches of law in Australia and target market.
r Provide a signed statement from the Directors of the company attesting to the truth of all information
being provided.
r Advise potential partner of any additional, independent due diligence checks being conducted.

r !SÍMUCHÍASÍPOSSIBLEÍENSUREÍTHATÍCONkICTÍRESOLUTIONÍORÍALLIANCEÍFALLÍUNDERÍ!USTRALIANÍJURISDICTIONÍANDÍ
law. This might not be possible depending on the nature of the arrangement.
r 7HOÍINÍTHEÍORGANISATIONÍHASÍAUTHORITYÍTOÍAPPROVEÍTHEÍALLIANCEÍANDÍIFÍNECESSARYÍSIGNÍjNALÍLEGALÍ
documents?
r Investigate Intellectual Property and Patent legislation and protection if this is relevant in your target
market and for the activity in which you are engaging.

Types Of Resources Links Types Of Information
Information from potential Accreditations

partner
Probity
NB: Data should be
Strategic documents
gathered from other
sources to back up, the Marketing propaganda
potential partners claims.
#OMPANYÍPROjLE
AEI www.aei.gov.au Government Policy

Accreditation requirements
Use government networks to research potential partner
from within. This is made easier if you have key attributes
already listed
Country Regulatory Fact www.austrade.gov.au Information on the regulatory and business requirements
Sheets on China, Vietnam, for establishing educational and training services abroad
Indonesia, Singapore,
Malaysia, Hong Kong,
Korea, India, Taiwan,
4HAILANDÍANDÍ*APAN
Austrade www.austrade.gov.au Due diligence on potential partner (this would be on a fee

for service basis)
Austrade IP Passport http://www.ipaustralia. IP issues with doing business online

Country Facts gov.au/ippassport/
)0ÍANDÍPROTECTIONÍRESOURCESÍINÍ*APANÍANDÍ#HINA
index.shtml
Protecting designs overseas
International Trademarks
International patents
Queensland Trade and http://www.export.qld. Resources and tools to support business looking at
Investment gov.au/ exporting their services

Australian Institute of http://www.aiex.com. Provides advice, resources and seminars providing advice
Export (AIEX) au/ about export
Companies that conduct Lawyers

individual due diligence
Consulting Firms For example KPMG, Australian
Government Solicitors, Price Waterhouse Coopers (PWC)
Local market companies that specialise in due diligence
Overseas Government Ministry of Education Information on legislative and regulatory frameworks

websites (for example) (China)
http://english.gov.cn
Ministry of Human
Resource Development
(India)
http://www.education.
nic.in/
Ministry of Education
(United Arab Emirates
(UAE))
http://www.moe.gov.
ae/english/pages/
default.aspx
Set up an internet alert

using key words such
as the name of your
potential partner, country,
international education and
regulation
5 Principle Five: Financial Considerations

Financial probity and remittance of funds from overseas is a high risk consideration in international
partnership. As Due Diligence is conducted (for the purpose of this document) from publicly available
INFORMATIONÍPROVIDERSÍSHOULDÍUSEÍCAUTIONÍWHENÍRELYINGÍONÍjNANCIALÍDUEÍDILIGENCEÍASÍAÍÍGUARANTEEÍ
OFÍREMITTANCEÍANDÍjNANCIALÍVIABILITYÍOFÍAÍPOTENTIALÍPARTNERÍ&ORÍEXAMPLEÍINÍCOUNTRIESÍWITHÍRELATIVELYÍHIGHÍ
corruption indexes fraudulent documents are relatively easy to come by. Another cultural factor is that
countries may not have the accounting systems and frameworks that are standard and required by law
in Australia. Unlike Australia, many countries do not have databases such as the Australian Securities
ANDÍ)NVESTMENTÍ#OMMISSIONÍ!3)# ÍMAKINGÍCONjRMATIONÍOFÍINFORMATIONÍPROVIDEDÍBYÍTHEÍPARTNERÍDIFjCULTÍ
4HEREFOREÍINÍADDITIONÍTOÍDUEÍDILIGENCEÍCHECKSÍPROVIDERSÍSHOULDÍENSUREÍjNANCIALÍMITIGATIONÍSTRATEGIESÍAREÍ
also inbuilt within the arrangement.
,ESSÍTIMEÍWOULDÍBEÍSPENTÍONÍjNANCIALÍCONSIDERATIONSÍFORÍINTERNATIONALÍENGAGEMENTÍACTIVITIESÍWHEREÍTHEREÍ
ISÍNOÍMONETARYÍTRANSACTIONÍ!ÍCHECKÍABOUTÍTHEÍjNANCIALÍSTABILITYÍOFÍANÍORGANISATIONÍMAYÍSUFjCEÍ

r &INANCIALÍSTATEMENTSÍFORÍTHEÍPREVIOUSÍYEARÍSHOWINGÍTHEÍjNANCIALÍPOSITIONÍOFÍTHEÍENTITYÍINCLUDINGÍATÍ
least:
o PROjTÍANDÍLOSSÍ
o balance sheet
o CASHÍkOW
r A statement signed by the Directors that the company is solvent and that state the Directors’
knowledge about future events that may impact on solvency.
r Provision of audit, banking, business and accounting referees.
r .AMESÍDETAILSÍANDÍQUALIjCATIONSÍOFÍ#HIEFÍ&INANCIALÍ/FjCERÍANDÍTHOSEÍRESPONSIBLEÍFORÍTHEÍjNANCIALÍ
management of the organisation.
r Do you need advice regarding repatriation of funds?
r Do you have relevant, appropriate and up to date insurances to cover the particular international
engagement activity?

Information from potential partner Accreditations

NB: Data should be gathered from Probity
other sources to back up the potential
Strategic documents
partners claims.
#OMPANYÍPROjLE
Referee reports provided by partner
AEI www.aei.gov.au Government Policy

Tax implication requirements
Austrade www.austrade.gov.au Due diligence on potential partner (this would

be on a fee for service basis)
Advice on economic stability.
Repatriation of funds
Trade and Investment Queensland http://www.export.qld. In-country information and assistance

gov.au/ regarding legal environment
Australian Institute of Export (AIEX) http://www.aiex.com. Provides advice, resources and seminars
au/ providing advice about export and
repatriation of funds

Companies that conduct individual due Accountants

diligence
Consulting Firms, For example KPMG,
Australian Government Solicitors, Price
Waterhouse Coopers (PWC)
Local market companies that specialise in due
diligence
Set up an internet alert using key

words such as the name of your
potential partner, country, international
education and regulation
Export Finance and Insurance http://www. #ANÍPROVIDEÍADVICEÍABOUTÍjNANCIALÍANDÍ

Corporation (EFIC) FYQPSUkOBODFHPWBV insurance issues with exporting.
Pages/Home.aspx
0ROVIDEÍAÍGUIDEÍTOÍjNANCEÍINÍEXPORTÍFORÍ3-%
Austrade - Guide to Islamic Finance http://www. Provides advice and information about
austrade.gov.au/ Islamic Finance and the impacts on Australian
ArticleDocuments/2792/ exporters.
Islamic-Finance-
Publication.pdf.aspx
Case Study – Financial Risk
A large Queensland VET Provider conducts a due diligence assessment on a university in Asia. All information
used during the assessment is sourced from the University and the University’s nominated referees.
4HEÍOUTCOMEÍOFÍTHEÍDUEÍDILIGENCEÍREPORTÍISÍTHATÍTHEÍ5NIVERSITYÍISÍAÍVIABLEÍCONCERNÍRECORDSÍINDICATEÍITÍISÍSOLVENTÍ
and the University has high powered political support for the alliance. Negotiations continue and eventually it
ISÍAGREEDÍTHATÍTHEÍ0ROVIDERÍINÍCOLLABORATIONÍWITHÍTHEÍ5NIVERSITYÍWILLÍDELIVERÍAÍ#ERTIjCATEÍ)6Í&OUNDATIONÍPROGRAMÍ
offshore using University facilities. It is also agreed that the University will collect all student fees and remit
money to the Provider on the receipt of an invoice. An agreement is written and signed on this basis. When the
alliance is announced publicly a number of the Provider’s international colleagues contact the director to express
CONCERNSÍABOUTÍTHEÍjNANCIALÍINTEGRITYÍOFÍTHEÍ5NIVERSITYÍINÍ!SIAÍANDÍTHEIRÍEXPERIENCESÍREGARDINGÍNON PAYMENTÍFORÍ
services rendered. On the basis of this information the Director of the Queensland Provider does an internet
SEARCHÍANDÍDISCOVERSÍTHATÍTHEÍ5NIVERSITYÍINÍ!SIAÍHASÍAÍHISTORYÍOFÍjNANCIALÍFORFEITSÍASÍREPORTEDÍBYÍTHEÍLOCALÍ!SIANÍ
PAPERÍ7HENÍTHEÍ0ROVIDERÍINVOICESÍTHEÍ5NIVERSITYÍFORÍSTUDENTSÍjRSTÍSEMESTERÍFEESÍNOÍMONEYÍISÍFORTHCOMINGÍ4OÍPUTÍ
pressure on the University in Asia, the Queensland provider does not release the offshore students’ results. This
causes dissatisfaction amongst the students, a number of the Provider’s staff spend time and resources trying to
REMITÍTHEÍMONEYÍNEGOTIATEÍWITHÍTHEÍ5NIVERSITYÍINÍ!SIAÍANDÍjELDÍCALLSÍFROMÍDISGRUNTLEDÍOFFSHOREÍSTUDENTSÍ
If the Provider had gathered information from a number of sources as well as the University in Asia this scenario
COULDÍHAVEÍBEENÍAVOIDEDÍ(ADÍTHEÍ0ROVIDERÍKNOWNÍABOUTÍTHEÍjNANCIALÍMANAGEMENTÍOFÍTHEÍ5NIVERSITYÍBEFOREÍTHEÍ
signing of the agreement a strategic decision could have been made as to whether to leave the deal or mitigate
against the risk by arranging for the students to pay the Provider directly. This demonstrates that information
from a variety of sources should be gathered and reliance on the goodwill of a potential partner to disclose all
information is a high risk practice.

6 Principle Six: Organisational Considerations
Considering operational and organisational aspects of the potential partner will vary depending on the
type of activity you are planning. It is essential that during the negotiation or due diligence process that
THEÍPROVIDERÍSENDSÍANÍAPPROPRIATELYÍQUALIjEDÍOFjCERÍTOÍATÍLEASTÍONEÍSITEÍVISITÍOFÍTHEÍPOTENTIALÍPARTNERÍ.OTÍ
only does this signify good-will but it is also easier for information to be obtained face-to-face than via
INTERNATIONALÍCOMMUNICATIONÍCHANNELSÍ)TÍALSOÍALLOWSÍTHEÍPROVIDERÍTOÍCONjRMÍINFORMATIONÍSUPPLIEDÍBYÍTHEÍ
POTENTIALÍPARTNERÍANDÍSEEÍTHEÍFACILITIESÍANDÍSTAFjNGÍAVAILABLEÍTOÍTHATÍPARTNERÍ!ÍSUITABLYÍQUALIjEDÍPERSONÍ
might be different depending on the partner you are assessing as well as the activity.
&ORÍ TRANSNATIONALÍ DELIVERYÍ OFÍ !USTRALIANÍ QUALIjCATIONSÍ ORÍ CUSTOMISEDÍ TRAININGÍ THEÍ !USTRALIANÍ REGULATORYÍ
framework should be used as a guide to assessing the capability and adequacy of organisational
infrastructure. It is in this check that you should ensure that delivery of programs offshore equate to the
QUALITYÍ OFÍ THOSEÍ DELIVEREDÍ INÍ !USTRALIAÍ ORÍ IDENTIFYÍ AREASÍ THATÍ REQUIREÍ IMPROVEMENTÍ !Í SUITABLYÍ QUALIjEDÍ
person to conduct the site visit may be an academic or training director. Someone who is familiar with
Australian compliance and training needs. This person should also be fully briefed and aware of the
cultural aspects of conducting business with your offshore partner.
For the assessment of exchange and study abroad partners student safety, infrastructure and support
SHOULDÍ BEÍ FOCUSEDÍ UPONÍ ASÍ OPPOSEDÍ TOÍ ACCREDITATIONÍ REQUIREMENTSÍ !Í SUITABLYÍ QUALIjEDÍ PERSONÍ MIGHTÍ
BEÍYOURÍ3TUDYÍ!BROADÍ-ANAGERÍ3TUDENTÍ,IAISONÍ/FjCERÍORÍTEACHERTRAINERÍWHOÍISÍMAPPINGÍTHEÍPROGRAMSÍ
equivalences.
For educational agents your marketing person might visit the agent to ensure that they have suitable
premises to host students and they provide appropriate services for your organisation.

6.1.1 Transnational Delivery

r Examine the organisational chart of the potential partner.
r Are effective administrative and management procedures and policies in place?
r 7HATÍAREÍTHEÍSKILLÍLEVELSÍANDÍQUALIjCATIONSÍOFÍACADEMICÍSTAFF
r Does the partner have appropriate premises and infrastructure to support the activity?
r Institutional facilities for staff and students including the relationship between these and the
requirements for delivering on the proposed arrangement.
r .OTEÍTHEÍEDUCATIONALÍPROjLEÍINCLUDINGÍTEACHING
r .OTEÍSTUDENTÍPROjLE
r Are their suitable facilities and support for students going on exchange for a semester abroad?
r Are the staff locals or expatriate Australians?
r What industry connections do they have?
r What are their systems and IT infrastructure like? Do they have adequate internet access?
r Do you keep adequate due diligence records to document what has been checked and assessed as
suitable?

6.1.2 Outbound Mobility Programs
r What student support facilities, infrastructure and services do they have available and in place?
r What are their library facilities and access to resources?
r Do they have dedicated staff to support and look after exchange students’ needs?
suitable?
6.1.3 Education Agent

r Do they have suitable premises and facilities to meet the needs of potential students?
r Do they have suitably trained staff?
suitable?

Information from Accreditations

potential partner
Strategic documents
NB: Data should be
#OMPANYÍPROjLE
gathered from other
sources to back up Infrastructure
the potential partners
Organization charts
claims.
Facilities
Policies and procedures
Potential partner’s website
Student guides
Course and study guides
AEI www.aei.gov.au Government policy

!CCREDITATIONÍREQUIREMENTSÍÍSPECIjCALLYÍAROUNDÍ
INFRASTRUCTUREÍSTAFjNGÍANDÍFACILITIES
Austrade www.austrade.gov.au Due diligence on potential partner (this would be

on a fee for service basis)
Local market conditions
Queensland Trade and http://www.export.qld.gov.au/ In-country information and assistance.

Investment

Set up an internet
alert using key words
such as the name of
your potential partner,
country, international
education and
regulation
Use networks including

students, peers, agents
Site visit by
appropriately
experienced and
trained staff to see
facilities, meet with
potential partner and
CONjRMÍSUITABILITYÍASÍ
partner.
Case Study: Checklist for Organisational Considerations in Due Diligence
A VET provider visited a potential partner in Norway with a checklist of organisational considerations required by them
FORÍTHEÍDELIVERYÍOFÍ!USTRALIANÍQUALIjCATIONSÍOFFSHOREÍ4HEÍLISTÍWASÍDEVELOPEDÍONÍTHEÍASSUMPTIONÍTHATÍANYÍOFFSHOREÍ
program should be planned and prepared as though it were to be delivered in Australia, using the AQTF as a basis.
The tool was used to establish the quality of facilities, physical resources, library and human resource planning being
offered by the Norwegian partner.
/NÍVISITINGÍ.ORWAYÍTHEÍ6%4ÍPROVIDERÍTOOKÍINTOÍCONSIDERATIONÍTHEÍLOCALÍENVIRONMENTÍANDÍWASÍkEXIBLEÍINÍTICKINGÍOFFÍTHEÍ
list. For example although there was no physical library facilities available each student was to be given access to
ONLINEÍCATALOGUESÍANDÍLIBRARYÍCOLLECTIONSÍ4HEÍCLASSESÍWEREÍTOÍBEÍOFFEREDÍINÍAÍFACILITYÍWHICHÍHADÍNOÍCOMPUTERSÍHOWEVERÍ
EACHÍSTUDENTÍWASÍPROVIDEDÍWITHÍAÍLAPTOPÍONÍENROLMENTÍ4HEÍ.ORWEGIANÍSTAFFÍWHILSTÍQUALIjEDÍINÍTHEIRÍSPECIjCÍAREASÍDIDÍ
NOTÍHOLDÍTHEÍ4RAININGÍANDÍ!SSESSMENTÍQUALIjCATIONÍ!ÍPLANÍWASÍTHEREFOREÍPUTÍINÍPLACEÍTOÍENSUREÍTHATÍTHEÍQUALIjCATIONSÍ
would be delivered to all staff before the commencement of teaching.
This case study provides an example of how the Australian quality framework can be used as a basis for due diligence,
HOWEVERÍAÍSUITABLYÍQUALIjEDÍPERSONÍNEEDSÍTOÍVISITÍTHEÍPOTENTIALÍPARTNERÍTOÍENSUREÍTHATÍQUALITYÍISÍMAINTAINEDÍWITHINÍTHEÍ
local context.

Attributes
7 The Risk Matrix

4HEÍjNALÍSTEPÍISÍIMPORTANTÍFORÍDUEÍDILIGENCEÍANDÍTHEÍONGOINGÍSUCCESSÍANDÍMANAGEMENTÍOFÍYOURÍPROJECTÍ4HISÍ
STEPÍALLOWSÍYOUÍTOÍCOMPAREÍTHEÍATTRIBUTESÍYOUÍIDENTIjEDÍATÍTHEÍBEGINNINGÍOFÍTHEÍSTRATEGICÍPROCESSÍANDÍMAPÍ
them against data gathered about the actual engagement model and partner. The information will then
allow you to make a strategic decision on the risk level of the particular activity and inform the ongoing
operational and management plan of the project. Although the word risk has negative connotations it
should be noted that a risk analysis can identify both positive and negative consequences of pursuing a
fRISKYÍACTIVITYtÍANDÍTHEÍKEYÍISÍTOÍENSUREÍTHATÍPROCESSESÍAREÍINÍPLACEÍTOÍPROMOTEÍTHEÍPOSITIVEÍCONSEQUENCESÍ
while reducing the negative ones.
4HEÍ!USTRALIAN.EWÍ:EALANDÍ3TANDARDÍFORÍ2ISKÍ-ANAGEMENTÍ!3.:3Í)3/Í ÍDEjNESÍRISKÍAS
fvTHEÍPOSSIBILITYÍOFÍSOMETHINGÍHAPPENINGÍTHATÍIMPACTSÍONÍYOURÍOBJECTIVESÍÍ)TÍISÍTHEÍCHANCEÍTOÍ
either make a gain or a loss. It is measured in terms of likelihood and consequence.”
The effective management of risk enables you to maximise opportunities and achieve your outputs.

r (AVEÍYOUÍIDENTIjEDÍIDEALÍPARTNERÍATTRIBUTESÍBASEDÍONÍYOURÍSTRATEGICÍPLANÍANDÍRESEARCHÍOFÍYOURÍTARGETÍ
market?
r Have you conducted appropriate research, using appropriate staff members, through appropriate
SOURCESÍOFÍCORPORATEÍPROjLE
r (AVEÍYOUÍCONSIDEREDÍALLÍjNANCIALÍANDÍLEGALÍASPECTSÍOFÍTHEÍPARTNERSHIPÍ(AVEÍYOUÍSOURCEDÍ
appropriate information from external sources other than the partner?
r Have your conducted a site visit offshore using appropriately experienced staff and has the partner
visited you? Have you considered all operational issues connected to the partnership and checked
them?
r Have you considered mitigating strategies to decrease the negative consequences and increase
positive consequences?
r Have you considered appropriate exit strategies?
r Have you gone through the Risk Management Steps? (See Diagram 3, page 34)..

Diagram 3: Risk Management Process4
ESTABLISH GOALS AND CONTEXT
Ideal Partner Attributes, International

Strategic Goals and Engagement Models
IDENTIFY RISKS
What can What can

happen happen
Communicate and Monitor and
Consult Review
IDEAL ATTRIBUTES VS ACTUAL

ATTRIBUTES
Likelihood Consequence
ESTABLISH LEVEL OF RISK
Low Medium High
EVALUATE RISKS
Compare against Set Risk

Criteria Priorities
ACCEPT / TREAT RISKS
No - Treat Yes - Monitor

Risks and Review
4 Adapted and modifed from the AS/NZS ISO 31000:2009.

7.2 Resources
Risk Management Institute http://www.rmia.org.au/# Risk Management processes

of Australia
International Organisation http://www.iso.org/iso/home. Risk Management processes

for Standardisation htm
Case Study – Risk Analysis to Identify The Gaps
4HEÍPROJECTÍINVOLVEDÍTHEÍDELIVERYÍOFÍ!USTRALIANÍQUALIjCATIONSÍOFFSHOREÍINÍ0.'ÍBYÍLOCALÍTRAINERSÍ!SSESSMENTÍWASÍ
conducted in Australia by the Australian provider against AQTF compliance requirements. During the negotiation
stage before training commenced, due diligence was conducted. The Australian CEO and marketing staff visited
the site where the Australian training would take place in PNG. On the basis of this visit it was deemed that the
FACILITIESÍWEREÍADEQUATEÍANDÍNEGOTIATIONSÍWEREÍjNALISEDÍ!FTERÍCOMMENCEMENTÍOFÍTHEÍTRAININGÍSEVERALÍISSUESÍ
arose including the fact that the local PNG trainers were not following processes and seemed to not understand
their role fully and deadlines were not being met.
The Training Manager then made a site visit to meet with the partners, local trainers and resolve the issues. After
a careful audit and considerations of the requirements of AQTF the local trainers did not actually have the correct
!USTRALIANÍQUALIjCATIONSÍANDÍTHEÍDELIVERYÍOFÍ!14&ÍTRAININGÍPACKAGESÍWEREÍNOTÍFULLYÍUNDERSTOODÍ&ROMÍAÍSTRATEGICÍ
ANDÍMARKETINGÍBUSINESSÍDEVELOPMENTÍPOINTÍOFÍVIEWÍTHEÍPARTNERÍWEREÍAÍGOODÍSTRATEGICÍjTÍ(OWEVERÍASÍAÍTRAININGÍ
specialist had not been to the site prior to the start of delivery compliance and delivery issues were missed.
If a full risk analysis with involvement from the appropriate staff had been conducted prior to the delivery
commencing then it might have been picked up that the right people and or organisational considerations had
been missed.
7.3 Other Considerations in International Engagement

7.3.1 Exit Strategies
%XITÍSTRATEGIESÍCANÍBEÍDEjNEDÍASÍEITHER
Í!ÍPLANÍFORÍGETTINGÍOUTÍOFÍAÍDIFjCULTÍORÍUNFAVORABLEÍSITUATION
Í!ÍPLANÍTHATÍMAXIMISESÍPROjTSÍWHENÍLIQUIDATINGÍINVESTMENTSÍORÍAÍBUSINESS5
During your due diligence process and the risk assessment it is important to ensure that appropriate exit
strategies are devised and implemented at all stages of project management and covering all possible
scenarios.
For example if during the due diligence process there is a strategic misalignment between your organisation
and your overseas partner the exit strategy would be to conclude negotiations. Exit strategies become more
DIFjCULTÍASÍTHEÍPROJECTÍPROGRESSESÍANDÍTHEÍPARTNERSHIPÍBECOMESÍMOREÍENTWINED
%XITÍ STRATEGIESÍ WHICHÍ INCLUDEÍ THEÍ jRSTÍ DEjNITIONÍ ABOVEÍ SHOULDÍ BEÍ EMBEDDEDÍ ANDÍ COMMUNICATEDÍ TOÍ YOURÍ
overseas partner within the project plan as well as any contract or Memorandum of Agreement you sign.
These might include
r appointing an independent mediator
r clear and documented responsibilities and obligations for each partner
r obligations and responsibilities to third parties should the partnership separate
r what happens if ownership of the partners changes hands
Í HTTPDICTIONARYREFERENCECOMBROWSE%XIT3TRATEGYÍDEjNITIONÍACCESSEDÍ3EPTEMBERÍ

Exit strategies should also be considered for successful partnerships. If a project and partnership is
PROjTABLEÍANDÍSUCCESSFULÍBUTÍONEÍPARTNERÍWISHESÍTOÍEXITÍHOWÍSHOULDÍTHEÍPARTNERSHIPÍBEÍLIQUIDATEDÍ7HATÍ
is the worth of the project and how should this be divided? Some possible scenarios to consider include:
r change of ownership
r change of market conditions
r change of heart by one provider.
Exit strategies would vary depending on the international engagement model and partner however
consideration should be given at the beginning of any partnership as to how it would end. For projects with
AÍHIGHÍjNANCIALÍRISKÍORÍOUTPUTÍYOUÍSHOULDÍALWAYSÍCONSIDERÍENGAGINGÍANÍATTORNEYÍTOÍCONSIDERÍDOCUMENTINGÍ
Ensure that any arrangement is negotiated and supported board to board as opposed to individual to
individual. This will ensure a long-term alliance as opposed to a person to person alliance.
7.3.2 Other considerations

r %NSUREÍARRANGEMENTÍISÍMUTUALLYÍBENEjCIALÍ)FÍITÍSEEMSÍTOÍBEÍMOREÍADVANTAGEOUSÍTOÍONEÍPARTNERÍOVERÍ
another then it will breakdown.
r Suggest to the potential partner that you would like a Due Diligence or Project Assessment Report
COMPLETEDÍANDÍGOÍÍONÍTHEÍCOSTÍOFÍANÍINDEPENDENTÍREPORTÍ0LEASEÍNOTEÍTHATÍDUEÍDILIGENCEÍ
might be construed as a negative thing in some cultures. You should ensure the language used is not
offensive whilst still ensuring your needs for due diligence are met.
r Take into consideration cultural needs and perceptions as this will directly impact on the
negotiations, the types of due diligence data you will need to consider as well as the access to this
information.
r Have a realistic and thorough understanding of the internal opportunity costs of pursuing the
ARRANGEMENTÍlÍDOÍYOUÍHAVEÍTHEÍSTAFFÍKNOWLEDGEÍjNANCIALÍCAPABILITYÍANDÍSUPPORTÍINTERNALLYÍ3PECIjCÍ
to this is having the right staff who have the appropriate cultural, technical skills and authority.
r Ensure records are kept of all due diligence conducted.
r Other strategies you might want to consider to remit money would include:
o direct payment from students
o advance payment by partner
o using bank promissory notes
o withholding your obligations to the partnership until payment is made.
r Consider using domestic focused due diligence processes as a guide for your offshore partnerships.
Although these will need to be contextualised for the local market taking into account cultural
considerations, in market legislative requirements.

7.4 Other Sources of Information
Resource Links
UNESCO – Rapid Response Facility – http://www.rapid-response.org/wp-content/uploads/2011/07/

Partnership Checklist Partnership-checklist_English_September2009.pdf
UNESCO – Rapid Response Facility – http://www.rapid-response.org/wp-content/uploads/2011/07/

Guidance with Working with Partners Partnership-guidance_September2009.pdf
5.%3#/ !SIAÍ0ACIjCÍ1UALITYÍ.ETWORKÍ http://unesdoc.unesco.org/images/0014/001433/143349e.pdf

(APQN) Toolkit: Regulating the Quality
of Cross-Border Education
OECD – Successful Partnerships A http://www.oecd.org/dataoecd/42/49/36279186.pdf

Guide
NQC Partnerships publications http://www.nqc.tvetaustralia.com.au/nqc_publications/publications/

partnerships

SECTION THREE
PROVIDER TEMPLATES
1. Due Diligence Process
Steps Principles Templates, Form, Policy
Identify Ideal Partner Strategic framework 1. Matrix of home institution factors and key
Attributes attributes of ideal partners
Research your target market
2. Sample internal due diligence checklist
3. Sample provider due diligence pack
4. Environmental Analysis Template
Identify Ideal Partner #ORPORATEÍ0ROjLE 5. Sample Application for consideration to be

Attributes appointed as an education agent
Legal Considerations
Í 3AMPLEÍÍ)NTERNATIONALÍ0ARTNERÍ0ROjLEÍTOÍBEÍSENTÍTOÍ
potential partner)
Organisational
7. Mobility Partner Checklist
Considerations
Conduct Risk Analysis The Risk Matrix 8. Due Diligence Risk Analysis Matrix
2. Matrix of Home Institution Factors and Key Attributes of Ideal Partners

Strategic Goals Engagement Strategies Ideal Partner Ideal Partner Attributes

3. Sample Internal Due Diligence Checklist
Project Name
Partner Name
Location
3FTQPOTJCMF0GkDFS
Criteria Checked Notes

Yes No
#ORPORATEÍ0ROjLE
Received a copy of their strategic

PLANCOMPANYÍPROjLE
Governance and management

chart including names,
QUALIjCATIONSÍANDÍDETAILSÍOFÍ
senior executives and managers
and relationship of other entities
to the principal
Business registration details

include location and registering
authority
The legal name of the company

as well as names and details of
the ownership structure of all
companies in the group
Has any of the owners/executive

been convicted of an offence,
been bankrupt or deregistered?
Is the potential partner aligned to

a particular government or party
that may be politically risky?
Reputation
Knowledge and experience of

Australia’s quality assurance
framework
Strategic motivations for

partnership
Any relevant accreditations,

registrations or ISO compliance
Main business, clients and

products

Yes No
Legal Considerations
Have a clear understanding of the

legal entity, governance structure
Do they have the authority

to activate the intentions of
the partnership? This would
be realised through a clear
understanding of the regulatory
environment in the target market
Where is the company/

organisation registered?
$OESÍCONkICTÍRESOLUTIONORÍ
alliance fall under Australian
jurisdiction and law? This might
not be possible depending on
the nature of the arrangement
Who in the organisation has

authority to approve the alliance
ANDÍIFÍNECESSARYÍSIGNÍjNALÍLEGALÍ
documents?
Investigate intellectual property

and patent legislation and
protection if this is relevant in
your target market and for the
activity you are engaging in
Investigate any regulatory

frameworks or restrictions that
you will have to adhere to in-
country
Financial statements showing

VIABILITYÍANDÍjNANCIALÍSTABILITYÍOFÍ
partner
A statement signed by the

Directors that the company
is solvent and that state the
Directors knowledge about
future events that may impact on
solvency
Provision of audit, banking,

business and accounting referees

Yes No
.AMESÍDETAILSÍANDÍQUALIjCATIONSÍ
OFÍ#HIEFÍ&INANCIALÍ/FjCERÍANDÍ
those responsible for the
jNANCIALÍMANAGEMENTÍOFÍTHEÍ
organisation
Received advice about

repatriation of funds
Received advice about insurance

requirements and cover
&ULLYÍAWAREÍOFÍjNANCIALÍRISKS
Organisational considerations
Has a site visit been conducted

BYÍANÍAPPROPRIATELYÍQUALIjEDÍ
staff member?
Transnational delivery
Are effective administrative and

management procedures and
policies in place?
What are the skill levels and

QUALIjCATIONSÍOFÍACADEMICÍSTAFF
Premises and infrastructure of

the partner?
Institutional facilities for staff

and students including the
relationship between these and
the requirements for delivering
on the proposed arrangement
%DUCATIONALÍPROjLEÍINCLUDINGÍ
teaching
3TUDENTÍPROjLE
Are they local staff or expatriate

Australians?
Do you keep adequate records

of what has been checked and
assessed as suitable?
What industry connections do

they have?

Yes No
What are their systems and IT

infrastructure like? Do they have
adequate internet access?
Outbound Mobility programs
What student support facilities,

infrastructure and services do
they have available and in place?
What are their library facilities

and access to resources?
Do they have dedicated staff to

support and look after exchange
students’ needs?
Do they have crisis management

policies for international
students?
Education Agent
Do they have suitable premises

and facilities to meet the needs
of potential students?
Do they have suitably trained

staff?

4. Sample Provider Due Diligence Pack
r COMPANYÍPROjLE
r company registration
r AUDITÍANDÍjNANCIALÍREPORTS
r company accreditations
r student prospectus
r STAFFÍPROjLES
r link to organisational website
r other information as appropriate

5. Sample Environmental Analysis Form for Target Market
Areas of research Current State of Play Impacts/Risks
P Political
E Economic
S Social
T Technological
L Legal
E Environmental

6. Sample Application for Consideration to be Appointed as an Education Agent6
<<Insert Logo>>
Application for consideration to be appointed as an education agent
$PNQBOZ1SPkMF
Company Details
Company Name
Street Address
Postal Address
Phone
Web
Fax
Skype
Email
#ONTACTÍ/FjCERSÍ )NSERTÍMOREÍjELDSÍASÍREQUIRED
"RANCHÍ/FjCEÍ,OCATIONSÍ
Company Director / Principal
Position
Phone
Email
Alternative Representative
Phone
Email
Company background
Business registration (ABN) If agent located in Australia require ABN if located offshore ask for evidence of local
No. business registration requirements
Details of registering country

and authority
6 This form can also be found in the International Education Agent Management – Queensland VET Sector, Best Practice Guide
http://training.qld.gov.au/information/tafe-qld-international/best-practice-guides.html

Has the company or any
individual within the
company ever been involved
in past, pending, threatened
or potential litigation,
arbitration, administrative
actions or other disputes?
"USINESSÍPROjLESTRATEGICÍ Y/N
plan
(please attach)
Organisational chart Y/N (please attach)
Key business activities (List)
Year founded
Years as an education agent
Number of staff
EATC Training (PIER Online) Y/N
List all staff that have

completed the EATC
.UMBERÍOFÍOFjCESÍLOCATIONS Í
Sub-agencies
Migration Institute Y/N

Membership
Partnerships with other

agencies (List)
!SSOCIATIONSÍAFjLIATIONSÍ
with other relevant
organisations (List)
Associations with any local

authorities / governments /
councils/etc. (List)
Marketing
Please indicate the

geographical territory you will
service.
Provide description of
your target market, trends,
demands etc.

Proposal for promotion and
marketing in the territories.
Performance
Number of students sent

abroad each year.
Proposed number of
students sent to us in the
next year.
Service Fees and Charges
What services do you provide

for students?
Please provide details of any

fees you charge students.
Referees
Educational Referees (x2)
Name
Position
Organisation
Address
Phone
Email
Student Referees (x2)
Name
Address
Phone
Email
Organisation/Institution
studying

Declaration
I am interested in representing you as an educational representative and I agree to do so in an honest and
professional manner. I agree to:
r Regularly monitor policies and changes to the policies as reported on the DIAC website.
r Regularly monitor policies and regulations and changes to these policies and regulations as reported on
the DEEWR website.
r I have read the National Code of Practice for Registration Authorities and Providers of Education and
Training to Overseas Students and agree to adhere to the relevant Standards.
Signed
Name Date
Organisation Position

4BNQMF*OUFSOBUJPOBM1BSUOFS1SPkMF
This form can be used for general educational and industry partnerships and can be adapted to a providers
needs.
Company Details Information Notes
Name
Address
Telephone
E-mail
Contacts – 1
Name
Position
Telephone
E-mail
Contacts – 2
Name
Position
Telephone
E-mail
$PNQBOZ1SPkMF QMFBTFBUUBDIBDPQZPGZPVS$PNQBOZ1SPkMF4USBUFHJD1MBO
Business registration No
Registering body and

country
Year established
Strategic plan/business
PROjLE
.AMESÍANDÍQUALIjCATIONSÍ
of executives

Financial probity
Educational accreditation
held
Industry accreditations
held
Other international
partnerships
National partnerships
0SHBOJTBUJPOBM1SPkMF
Courses and
QUALIjCATIONSÍOFFERED
Number of staff and

QUALIjCATIONS
Facilities including
classrooms, library and
computers.
Access to trained staff
Information systems
including administrative
ANDÍjNANCIAL
3TUDENTÍ0ROjLE
Contacts/ involvement
with industry

8. Mobility Partner Checklist78
This Mobility Partner Checklist may be used in conjunction with other due diligence tools. The checklist is
designed to ensure that the essential elements of successful partnerships will be met. This checklist may
be completed during a site visit to the partner, through a reputable third party, or through a series of virtual
engagements with the potential partner.
The Overseas Partner
Are they internationally recognised? yes no

Is their reputation comparable to ours? yes no
Are there synergies with our international strategy? yes no
Are they recommended by other partners? yes no
Have we worked with them successfully in previous areas? yes no
&EVDBUJPO*OEVTUSZ1SPkMF
$OESÍTHISÍPROGRAMÍjTÍOURÍACADEMICÍGOALS yes no
Are their teaching areas similar to ours? yes no
Can we compare our courses and teaching? yes no
Are faculties involved? yes no
Are they accredited nationally? yes no
Will we recognise their courses? yes no
Are courses available in the appropriate language? yes no
Programs
Are they interested in internships? yes no

Are they interested in short term exchange? yes no
Are they interested in long term exchange? yes no
Are they interested in study tours? yes no
Will this be a two way opportunity? yes no
Student Interest
Is this partner attractive to our students:

Academically? yes no
Financially? yes no
Geographically? yes no
Culturally? yes no
Facilities
Is there a good student support system? yes no

Are pastoral care programs in place? yes no
Is the equipment comparable, more advanced or unique for our student learning? yes no
7 This form can also be found in the Queensland Outbound Mobility Best Practice Guide http://training.qld.gov.au/international
Í !DAPTEDÍ ANDÍ EXPANDEDÍ FROMÍ f!15!2)53Í !SSURINGÍ QUALITYÍ INTERNATIONALISATIONÍ OFÍ STUDYÍ COURSESÍ ANDÍ COURSEÍ GUIDANCEtÍ
%2!3-53Í-5.$53Í02/*%#4Í ! Í4HEÍPROJECTÍWASÍjNANCEDÍBYÍTHEÍ%5Í#OMMISSIONÍFORÍÍMONTHSÍINÍlÍANDÍ
National VET Sector Mobility Handbook and Toolkit.
Processes
Is it safe to send our students there? yes no

Are travel advisories in place? (www.smarttraveller.gov.au) yes no
How easy is it to get a visa to this location for study or work? yes no

9. Due Diligence Risk Analysis Matrix
Due diligence Ideal partner Mitigating strategies/
Actual attributes Risk assessment
factors attributes actions

List of Acronyms
ACPET Australian Council of Private Education and Training
AQF !USTRALIANÍ1UALIjCATIONSÍ&RAMEWORKÍTHEÍPOLICYÍFRAMEWORKÍTHATÍDEjNESÍALLÍ
QUALIjCATIONSÍRECOGNISEDÍNATIONALLYÍINÍPOST COMPULSORYÍEDUCATIONÍANDÍTRAININGÍWITHINÍ
Australia
AQTF Australian Quality Training Framework: the nationally agreed quality assurance
arrangements for the VET system in Australia
APQN !SIAÍ0ACIjCÍ1UALITYÍ.ETWORK
ASQA Australian Skills Quality Authority
DEEWR Department of Education, Employment and Workplace Relations (Commonwealth)
DIAC Department of Immigration and Citizenship
ESOS The Education Services for Overseas Students Act 2000
NQC National Quality Council
OECD Organisation for Economic Cooperation and Development
QETI Queensland Education and Training International (QETI) now known as International
Education and Training Unit within the Department of Employment, Economic
Development and Innovation (DEEDI)
UNESCO 5NITEDÍ.ATIONSÍ%DUCATIONALÍ3CIENTIjCÍANDÍ#ULTURALÍ/RGANISATION
VET Vocational Education and Training
VTI Victorian TAFE International
TAFE Technical and Further Education
TNE Transnational Education. It refers to the:
qÍMARKETING
qÍENROLMENTÍPROCESSESÍAND
qÍDELIVERYÍANDORÍASSESSMENT
Of programs/courses in a country other than Australia by an Australian-approved
provider, where delivery includes a face-to-face component. The education and/or
TRAININGÍACTIVITYÍMAYÍLEADÍTOÍANÍ!USTRALIANÍQUALIjCATIONÍORÍMAYÍBEÍAÍNON AWARDÍCOURSEÍ
but in either case an Australian-approved provider is associated with the education/
training activity.


Due Diligence Best Practice Guide

Caricato da

Informazioni sul documento

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

Due Diligence Best Practice Guide

Caricato da

Copyright:

Formati disponibili

DEPARTMENT OF EDUCATION, TRAINING AND EMPLOYMENT

Queensland VET Sector

Department of Education, Training and Employment

Department of Education, Training and Employment

For Further Contributions

2 Partnership Due Diligence | A Best Practice Guide

Partnership Due Diligence | A Best Practice Guide 3

SECTION ONE: CONTEXT OF THE GUIDE 10

SECTION TWO: PRINCIPLES OF DUE DILIGENCE 17

4 Partnership Due Diligence | A Best Practice Guide

SECTION THREE: PROVIDER TEMPLATES 38

Partnership Due Diligence | A Best Practice Guide 5

1.2 Aim of the Guide

6 Partnership Due Diligence | A Best Practice Guide

1.3.1 Phase One: Queensland, Australian and international desktop research

1.3.2 Phase Two: Interviews with targeted stakeholders in Australia

1.3.3 Phase Three: Report

1.4 How to Use this Guide

Step One: Establish desired partner characteristics

Partnership Due Diligence | A Best Practice Guide 7

Diagram 1: Due Diligence within a Strategic Framework

ORGANISATION STRATEGIC PLAN

Marketing Plan BUSINESS OPPORTUNITY

MANAGING THE OPPORTUNITY

Operational Plan Contract/Agreement

8 Partnership Due Diligence | A Best Practice Guide

Step Three: Conduct a Risk Analysis

Partnership Due Diligence | A Best Practice Guide 9

1.2 Why is Due Diligence Conducted

1 Due Diligence.Dictionary.com. Merriam-Webster’s Dictionary of Law. Merriam-Webster, Inc. http://dictionary.reference.com/

10 Partnership Due Diligence | A Best Practice Guide

Partnership Due Diligence | A Best Practice Guide 11

12 Partnership Due Diligence | A Best Practice Guide

Engagement Activity Possible Partners Due Diligence Focus Further Resources

Inbound Students International Strategic International Education Agent Management –

Consultancy Partnership broker Strategic alignment

Partnership Due Diligence | A Best Practice Guide 13

3 Australian Regulatory Framework

Standard 4 of the National Code (2007) – Education Agents

14 Partnership Due Diligence | A Best Practice Guide

According to the ASQA website (http://www.asqa.gov.au/about-asqa/regulatory-approach/risk.html)

Partnership Due Diligence | A Best Practice Guide 15

16 Partnership Due Diligence | A Best Practice Guide

Diagram 2: Due Diligence Framework and Principles

STEP ONE STEP TWO STEP THREE

PRINCIPLE ONE: PRINCIPLE THREE: LOW RISK:

Partnership Due Diligence | A Best Practice Guide 17

1 Principle One: Strategic Framework

1.1 Key Questions and Considerations

18 Partnership Due Diligence | A Best Practice Guide

Internal strategic documentation Organisational Strategic Plans

Historical operating experience of Internal Student Statistics

Industry seminars and workshops http://www.austrade.gov.au/Export- Austrade workshops

http://www.ieaa.org.au/content/?id International Education Association

http://www.aiec.idp.com/home. Australian International Education

http://www.acpet.edu.au/events/ ACPET conference/workshops

Austrade www.austrade.gov.au Information Regarding The

Trade and Investment Queensland http://www.export.qld.gov.au/ Advice And Resources On Exporting

Australian Institute of Export (AIEX) http://www.aiex.com.au/ Provides Advice, Resources And

Australian Education International (AEI) www.aei.gov.au Government to government

Partnership Due Diligence | A Best Practice Guide 19

2 Principle Two: Know Your Target Market

2.1 Considerations and Key Questions

20 Partnership Due Diligence | A Best Practice Guide