Send this list at the outset and ask for everything to be uploaded to a single indexed data room. Mark items not applicable rather than leaving them blank — a blank line is indistinguishable from an item the target hopes you will forget. Priority: High means it is a condition to proceeding; Medium means it is required before completion; Low means it can follow.
Due Diligence Checklist
Investment in [TARGET COMPANY NAME] — request list
Prepared by [FIRM / INVESTOR] Date: [DATE] Diligence period: the [3] financial years ended [DATE] and the stub period to [DATE]
Send this list at the outset and ask for everything to be uploaded to a single indexed data room. Mark items not applicable rather than leaving them blank — a blank line is indistinguishable from an item the target hopes you will forget. Priority: High means it is a condition to proceeding; Medium means it is required before completion; Low means it can follow.
1. Corporate and constitutional
Establish that the company exists, that its capital is what the cap table says, and that its records would survive inspection.
| # | Document or information requested | Period | Priority | Provided | Data room reference | Reviewer comment |
|---|---|---|---|---|---|---|
| 1.1 | Certificate of incorporation, and every certificate issued on change of name, conversion or shifting of registered office | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.2 | Memorandum and articles of association, current and every amended version, with the resolutions authorising each amendment | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.3 | Master data extract from the Registrar of Companies portal, and all forms filed, with challans | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.4 | Register of members, register of directors and key managerial personnel, register of charges, register of related party contracts, and register of loans and investments | Current | High | [Y/N] | [REF] | [COMMENT] |
| 1.5 | Minutes of all Board meetings, committee meetings and general meetings, with attendance records and signed resolutions | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.6 | Share certificates issued, with evidence of stamping, and share transfer forms in Form SH-4 with evidence of stamping | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.7 | All private placement offer letters, records of offers, return of allotment filings, and separate bank account statements for subscription money | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.8 | Valuation reports supporting every issue of securities, and, where applicable, valuation certificates for exchange control purposes | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.9 | All shareholders’ agreements, subscription agreements, share purchase agreements, convertible instruments, side letters and waivers, whether or not still in force | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.10 | Details of every subsidiary, associate, joint venture, branch and liaison office, with the same documents for each | Current | Medium | [Y/N] | [REF] | [COMMENT] |
| 1.11 | Details of any striking off, revival, compounding, adjudication or condonation of delay proceeding | Since inception | High | [Y/N] | [REF] | [COMMENT] |
| 1.12 | Startup recognition certificate, and any certificate under a tax holiday or incentive scheme | Current | Medium | [Y/N] | [REF] | [COMMENT] |
10 more pages in the Word file
Preview of the first page. Highlighted fields are the ones you fill in — they appear the same way in Word. Scroll the preview to read on; the full document runs to 11 pages.
These notes accompany the template and explain the drafting choices, the compliance points and the mistakes most often made with this document. They appear as a final page in the Word file, intended to be deleted before the document is executed.
The most common failure in a diligence exercise is not the target withholding something but both sides losing track of what was asked and what was answered. Number the request list, require the response to carry the same numbering, and require an explicit "not applicable" rather than silence. This checklist is designed to be used as a live tracker, with the last three columns filled in as the exercise proceeds.
Three years is conventional for financial items and is usually wrong for tax and for corporate records. Tax exposure should be diligenced to the end of the period within which the authority may still assess or reassess. Corporate records — share issues, transfers, stamping, filings — should be diligenced since inception, because a defect in the first allotment survives every subsequent round and is the one nobody has ever checked.
The capitalisation table, the register of members, and the returns of allotment filed with the Registrar should agree. In early-stage companies they frequently do not, usually because an allotment was made and never filed, or a transfer was executed and never registered. Item 2.1 asks for the reconciliation rather than the table alone, which is the difference between finding the problem and not.
Item 2.8 asks about promises of equity never reduced to writing. Every early-stage company has at least one — an early employee, an adviser, a friend who helped. They surface at the worst moment, and no warranty catches something nobody remembered to disclose. Ask the question directly and in person as well as on the list.
Items 6.2 and 6.3 are where most seed-stage companies fail. A contractor who was paid but never signed an assignment retains copyright in what they wrote. A domain registered to a founder’s personal email is not the company’s asset. Neither shows up in the financial statements. Ask for the assignment for every single contributor, not a sample.
Item 6.4 asks for a bill of materials, not an assurance. A copyleft component linked into proprietary code can, on one reading of its licence, require the whole work to be made available on the same terms. It is cheap to scan for and expensive to discover after an acquisition.
Item 5.14 asks for the basis on which anyone is classified as a consultant. Misclassification creates retrospective exposure to social security contributions, interest and penalty, and it is the single most common labour finding in a technology company. Read the actual contracts and compare them to how the person is really engaged — fixed hours, company equipment, a reporting line and an appraisal are the markers.
Item 4.7 matters because credit availed on an invoice from a supplier who did not file its own return can be denied to the buyer. The exposure sits with the company being diligenced, not with the defaulting supplier, and it compounds with interest. Ask for the reconciliation rather than the returns alone.
The obligations under the current data protection framework are being brought into force in phases. Diligence should therefore ask two different questions: is the company compliant with what is in force today, and does it have a credible plan for what is coming. Treat the second as a covenant or a condition rather than as a warranty, and price the build cost into the plan.
Items 1.6 and 4.11. Unstamped or understamped share certificates, transfer deeds, leases and agreements are inadmissible in evidence until duty and penalty are paid. They are found in almost every diligence and are almost always fixable, but the fix takes time and should be a condition precedent rather than a post-completion undertaking.
Any allotment not reported to the Registrar; any foreign investment not reported to the authorised dealer bank within the prescribed period; any intellectual property registered in a personal name; any undocumented equity promise; any employee classified as a consultant who works fixed hours on company equipment; any related party transaction without approval; any pending search, survey or summons from a tax authority. Each of these is a condition precedent, not a warranty.
Reflects Indian law and practice current as of {{DATE OF USE}}. Scope the list to the sector and stage of the target — a regulated business will need a substantial additional section, and a pre-revenue company will not need most of Section 8.
This is a ready-to-use template provided for convenience. Laws and requirements change, and every situation is different — please have it reviewed by a qualified professional (a lawyer, company secretary, or chartered accountant as relevant) before you rely on it.