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Pre-Sale Due Diligence


Almost anything you can imagine should be part of the pre-sale due diligence. If a selling company (seller) wants to receive the best terms and price, they must perform a certain amount of their own due diligence.

While not comprehensive, the following are the key aspects of what should be completed:

  1. Designate a leader to coordinate all of the internal and external personnel involved.
  2. Establish a meaningful timeline to complete each critical task.
  3. Ensure that your tax advisers are in-place and very competent. These should include, at a minimum, your accountant, wealth manager and investment banker.
  4. Complete and document the company's standards for at least financial controls; insurable risk (property, product, and employee practices); and, benefits plans.
  5. Review legal and contractual agreements in-place. Determine ownership of assets, especially IP.
  6. Understand work place flow, efficiency, and culture. Assess correcting actions required.