A seller's checklist before the buyer's review

Before buying a company, a buyer usually carries out a review (due diligence): examines the documents and asks questions in order to understand what is really being bought. It is useful for the seller to carry out this review first, on their own. Below is a general list that is worth adapting to your situation.

1. The company basics

  • The articles of association and their amendments.
  • Shareholder decisions, minutes, documents appointing the manager.
  • The data in the register matching reality.
  • The ownership structure: who owns the company and in what shares.

2. Finances and taxes

  • Financial statements for the last several years.
  • Tax returns and correspondence with the tax authorities.
  • Bank account statements, loan and leasing contracts.
  • A list of the debts the company owes and the debts others owe to it.

3. Contracts

  • The most important contracts with customers, suppliers, landlords.
  • Terms of long-term contracts: terms, termination, whether they change when the owner changes.
  • Confidentiality and non-compete agreements.

4. Employees

  • Employment contracts and internal rules documents.
  • An overview of unused holidays, bonuses or other obligations.
  • Information about managers and key specialists.

5. Assets, intellectual property, permits

  • Ownership documents, pledges, arrests or other encumbrances.
  • Trademarks, domains, software and who their lawful owner is.
  • Permits or licences needed for the activity, their validity and terms.

6. Disputes and risks

  • Ongoing or possible disputes, claims, inspections.
  • Compliance with data protection requirements: what personal data you process and under what procedure.

How to use it

You do not have to have everything perfect. The most important thing is to know where the gaps are and to mention them yourself. Buyers usually value openness more than an ideal picture that collapses after the first question. Keep the gathered documents in one place, and give access only to those who really need it, and only after a confidentiality agreement has been signed.

This list is a general example. In the case of a specific company the list may be shorter or longer, so it is worth agreeing it with a lawyer.

This text is general information, not legal advice.

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