By DiligensHub team · Last updated
What Is a Due Diligence Checklist?
A due diligence checklist is the list of documents and answers a buyer needs before it signs. It also serves as the plan for the data room.
On the buyer's side it is often called the request list. The buyer's advisors send it, and the seller works through it item by item.
On the seller's side, the same list is a preparation tool. A seller that collects these documents early is ready when buyers arrive. Gaps are found and fixed in private, not in front of a bidder.
Each item becomes a folder or a file in the virtual data room. So the checklist and the room's index usually mirror each other.
What Goes in an M&A Due Diligence Checklist?
This checklist groups 87 requests into eleven areas, from corporate records to regulatory approvals. Add or remove items to fit the business and the deal.
Each table gives the request and what a reviewer looks for in it. The codes match the download, so a team can refer to "FIN-05" in email and Q&A.
Corporate Records
Corporate records show who owns the company and who can sign for it.
| Code | Request | What to look for |
|---|---|---|
| CORP-01 | Certificate of incorporation and constitutional documents | Current versions, with every amendment |
| CORP-02 | Bylaws or articles of association | The version in force, and any shareholder approvals needed for the deal |
| CORP-03 | Group structure chart | Every subsidiary, its ownership percentage and where it is registered |
| CORP-04 | Capitalization table | All shares, options, warrants and convertible instruments, by holder |
| CORP-05 | Shareholder agreements | Transfer limits, drag-along and tag-along rights, and consent rights |
| CORP-06 | Board and shareholder minutes | The last three years, including written resolutions |
| CORP-07 | Register of directors and officers | Current holders and any recent changes |
| CORP-08 | Powers of attorney | Any still in force, and who holds them |
| CORP-09 | Prior acquisitions and disposals | Purchase agreements and any obligations that survive |
| CORP-10 | Good standing certificates | For the company and each subsidiary, recently issued |
Financial Information
Financial records test whether the numbers in the pitch hold up.
| Code | Request | What to look for |
|---|---|---|
| FIN-01 | Audited financial statements | The last three years, with auditor reports and management letters |
| FIN-02 | Monthly management accounts | Year to date and the prior year, reconciled to the audited figures |
| FIN-03 | Budget and forecast | The current budget, the forecast and the assumptions behind them |
| FIN-04 | Revenue by customer, product and region | The last three years, to show concentration and trends |
| FIN-05 | Working capital detail | Monthly receivables, inventory and payables, to set a working capital target |
| FIN-06 | Accounts receivable aging | Current aging, with bad debt history and reserves |
| FIN-07 | Debt and financing agreements | Loans, credit lines, guarantees and security, with balances |
| FIN-08 | Capital expenditure | Historic spend and committed projects |
| FIN-09 | Off-balance-sheet commitments | Guarantees, letters of credit and contingent liabilities |
| FIN-10 | Quality of earnings report | Any prior report, with the adjustments it proposed |
| FIN-11 | Accounting policies | Revenue recognition, and any changes in the last three years |
Tax
Tax records show what has been filed and paid, and what could still be owed.
| Code | Request | What to look for |
|---|---|---|
| TAX-01 | Corporate income tax returns | The last three years, for every company in the group |
| TAX-02 | Sales, VAT and indirect tax returns | The last three years, with any registrations |
| TAX-03 | Payroll tax filings | The last three years |
| TAX-04 | Tax audits and correspondence | Open and closed audits, assessments and settlements |
| TAX-05 | Tax rulings and elections | Any ruling, election or agreement with a tax authority |
| TAX-06 | Transfer pricing documentation | Policies and studies for transactions between group companies |
| TAX-07 | Tax losses and credits | Amounts carried forward, and any limits on their use |
| TAX-08 | Tax sharing agreements | Any agreement to share tax liabilities within or outside the group |
Legal and Contracts
Contracts show what the business has promised, and what a sale could trigger.
| Code | Request | What to look for |
|---|---|---|
| CON-01 | Material customer contracts | The largest customers by revenue, with all amendments |
| CON-02 | Material supplier contracts | Key suppliers, and any single-source supply |
| CON-03 | Change of control and assignment clauses | Contracts a sale could end, or that need consent |
| CON-04 | Exclusivity and non-compete terms | Limits on where or with whom the business can trade |
| CON-05 | Most favored nation clauses | Promises to match the best price given to any other customer |
| CON-06 | Partnership, joint venture and distribution agreements | Terms, exit rights and profit sharing |
| CON-07 | Government contracts | Terms, audits and any special conditions |
| CON-08 | Litigation | Current, pending and threatened claims, with counsel's assessment |
| CON-09 | Settlements and judgments | The last five years, and any continuing obligations |
| CON-10 | Guarantees and indemnities given | Any promise to cover another party's losses or debts |
Employees
Employee records show the cost of the team and the promises made to it.
| Code | Request | What to look for |
|---|---|---|
| HR-01 | Organization chart | Reporting lines and headcount by team and location |
| HR-02 | Employee census | Role, start date, pay and location, without personal identifiers |
| HR-03 | Senior employment contracts | Executives and key staff, including notice and severance terms |
| HR-04 | Bonus, commission and incentive plans | Plan rules and amounts paid or owed |
| HR-05 | Equity and option plans | Plan documents, grants and vesting schedules |
| HR-06 | Retention and change of control payments | Any payment a sale would trigger |
| HR-07 | Benefit and pension plans | Plan documents, funding status and obligations |
| HR-08 | Contractors and consultants | Agreements, and how each one is classified |
| HR-09 | Collective agreements | Any union or works council agreements |
| HR-10 | Employment disputes | Claims, complaints and investigations from the last three years |
| HR-11 | Employee handbook and policies | Current policies, including leave and conduct |
Intellectual Property
Intellectual property records show what the company owns, and what it only licenses.
| Code | Request | What to look for |
|---|---|---|
| IP-01 | Patents and applications | Schedule by country, with status and owner |
| IP-02 | Trademarks and domain names | Registrations, applications and renewal dates |
| IP-03 | Copyrights and software | Key works and the code the business depends on |
| IP-04 | Inbound licenses | Third-party technology the business relies on, and its terms |
| IP-05 | Outbound licenses | Rights the company has granted to others |
| IP-06 | Invention assignment agreements | Proof that employees and contractors assigned their work to the company |
| IP-07 | Open source use | Components in use, and their license terms |
| IP-08 | IP disputes | Infringement claims made by or against the company |
IT and Data
IT and data records show how the business runs, and how it protects personal data.
| Code | Request | What to look for |
|---|---|---|
| IT-01 | Systems overview | Key systems, hosting and who supports them |
| IT-02 | Software and cloud contracts | Major vendors, terms and renewal dates |
| IT-03 | Information security policies | Current policies and how they are enforced |
| IT-04 | Security assessments and certifications | Recent audits, penetration tests and findings |
| IT-05 | Security incidents | Breaches and incidents from the last three years, and the response |
| IT-06 | Privacy policies and notices | Current versions for customers and employees |
| IT-07 | Data processing agreements | Agreements with vendors that handle personal data |
| IT-08 | Data maps and records of processing | What personal data is held, where and why |
| IT-09 | Business continuity and backups | Plans, test results and recovery targets |
Real Estate
Real estate records show where the business operates, and on what terms.
| Code | Request | What to look for |
|---|---|---|
| RE-01 | Schedule of properties | Every owned and leased site, with its use |
| RE-02 | Title documents | Deeds and title reports for owned property |
| RE-03 | Leases | All leases and subleases, with amendments |
| RE-04 | Lease assignment and consent terms | Leases a sale could affect |
| RE-05 | Mortgages and liens | Any security over property |
| RE-06 | Surveys and building reports | Recent surveys, inspections and planned repairs |
Environmental
Environmental records show risks that can stay with a site, or a buyer, for years.
| Code | Request | What to look for |
|---|---|---|
| ENV-01 | Environmental permits | Permits held, their conditions and renewal dates |
| ENV-02 | Environmental assessments | Site assessments and reports for current and former sites |
| ENV-03 | Hazardous materials | Materials used or stored, and how they are handled |
| ENV-04 | Notices and claims | Notices, claims or investigations from regulators or neighbors |
| ENV-05 | Remediation | Clean-up work done or required, with costs |
Insurance
Insurance records show which risks are covered, and which are not.
| Code | Request | What to look for |
|---|---|---|
| INS-01 | Schedule of policies | Insurer, cover, limits, deductibles and premium for each policy |
| INS-02 | Policy documents | Current policies, including directors and officers cover |
| INS-03 | Claims history | Claims from the last five years, open and closed |
| INS-04 | Self-insurance | Any risk the company carries itself, and the reserves |
Regulatory
Regulatory records show the approvals the business needs to keep operating.
| Code | Request | What to look for |
|---|---|---|
| REG-01 | Licenses and permits | Every license the business needs to operate, with renewal dates |
| REG-02 | Regulator correspondence | Inspections, findings and correspondence from the last three years |
| REG-03 | Compliance policies | Anti-bribery, sanctions, export control and competition policies |
| REG-04 | Investigations | Open or past investigations by any authority |
| REG-05 | Filings and approvals for the deal | Merger control, foreign investment or sector approvals the deal may need |
How Do You Tailor the Checklist to a Deal?
Start from the full list, cut what doesn't apply, then add what the industry needs. Four things shape the list most: deal structure, industry, size and buyer.
- Deal structure. In an asset purchase, the buyer chooses which assets and contracts it takes. In a share purchase, it takes the whole company, history included. A share purchase needs the deeper corporate and tax review.
- Industry. A software company needs more depth on code, licenses and data. A manufacturer needs more on sites, permits and the environment.
- Size. A small deal can use the core items in each area. A larger one adds detail, such as results by business unit.
- Buyer. A trade buyer often focuses on how the businesses fit together. A financial buyer focuses on cash flow and quality of earnings.
Agree the scope with the other side early. A request list that keeps growing slows the deal and frustrates both teams.
Who Prepares the Due Diligence Request List?
The buyer's advisors usually draft the request list. The seller's team answers it, ideally from a checklist it started before the sale began.
On the buy side, each advisor adds its own requests. Lawyers ask about contracts and disputes. Accountants ask for the financial and tax detail. Specialists cover IT, environmental or regulatory areas.
On the sell side, preparation starts earlier. The company and its advisors gather documents before the first buyer is contacted. Some sellers commission vendor due diligence reports, so buyers start from an independent review.
Either way, name one person on each side who owns the list. That person decides what is a duplicate, and what is out of scope.
How Do You Track Due Diligence Requests?
Give every request a code, an owner and a status. Link each answer to the documents that support it.
A simple tracker has these columns:
- Code and request, from the checklist
- Owner on the seller's side
- Status: open, in progress, answered or not applicable
- Where the answer is: a file in the data room, or a Q&A reply
- Date answered, so both sides can see what is outstanding
A spreadsheet works for one buyer and a short list. With several bidders, track requests inside the data room. Then each answer links straight to its file, and each bidder sees only its own requests.
Where Can You Download the Checklist?
Download it free below, as an Excel workbook or a CSV file. There is no form and no email to give.
Each row has five columns: Category, Code, Title, Description and Expected files. Expected files is how many documents usually answer the item, such as three years of tax returns.
The columns match DiligensHub's request list import, so the file loads as a template with no changes.
Questions
- What is the difference between a checklist and a request list?
- They hold the same items. A checklist is the general list a seller prepares from. A request list is what a particular buyer sends for a particular deal. Most request lists start from a standard checklist and add the buyer's own questions.
- What are the main types of due diligence?
- The main types are financial, legal, tax, commercial and operational due diligence. Larger deals add IT, environmental, regulatory and human resources reviews. Each is usually led by a different advisor.
- Should a seller prepare before buyers ask?
- Yes. Collecting documents before the sale starts lets the seller find gaps and fix them privately. It also means buyers get answers sooner, which keeps the process on schedule.