Due Diligence When Buying a Company — Complete Checklist

Due diligence is your safeguard against unpleasant surprises after an acquisition. Here is the checklist we recommend.

Finances

• Financial statements for the last 3 years + interim accounts.
• Accounts receivable, accounts payable and ageing analysis.
• Bank debt, guarantees and leases.

Tax and VAT

• Tax and VAT returns.
• Any ongoing tax disputes.
• Balances on owners’ current accounts (unlawful loans).

Contracts

• Major customer and supplier agreements — do they contain change of control clauses?
• Property leases.
• Licences and permits.

Employees

• Employment contracts, notice periods and bonus agreements.
• Holiday pay liabilities.

Legal Matters

• Litigation and disputes.
• Intellectual property rights (trade marks, domains, software).
• GDPR compliance.

After Due Diligence

The findings are used to adjust the price or inform warranties in the purchase agreement. Read more about due diligence advisory services.

Frequently Asked Questions

How long does due diligence take?

For small companies, typically 2–6 weeks.

Do I need a lawyer and an accountant?

Yes, ideally both — legal and financial due diligence cover different risks.

What is a change of control clause?

A clause that gives the other party the right to terminate the agreement when ownership changes.

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