Four areas surface problems in almost every Singapore diligence exercise, and none of them are the financials: unassigned founder intellectual property, employment compliance gaps (key employment terms, payslips, CPF for pass holders), stale statutory registers, and undocumented founder loans. Run those first.
Due Diligence
Checklist for a Singapore company
Four areas surface problems in almost every Singapore diligence exercise, and none of them are the financials: unassigned founder intellectual property, employment compliance gaps (key employment terms, payslips, CPF for pass holders), stale statutory registers, and undocumented founder loans. Run those first.
| Item | Detail |
|---|---|
| Target | [COMPANY NAME], UEN [UEN] |
| Transaction | [Financing round / Acquisition / Secondary purchase] |
| Reviewer | [NAME] |
| Data room | [LOCATION] |
| Cut-off date for information | [DATE] |
| Disclosure letter received | [DATE] |
| Red flags identified | [NUMBER] — see the summary |
| Status | [In progress / Complete] |
The Four That Matter Most
| # | Area | What goes wrong | How to test it |
|---|---|---|---|
| 1 | Founder and contractor IP | Code, designs or brand created before incorporation, or by contractors with no assignment clause, still belongs to the individual | Ask for signed assignments from every founder and every contractor who touched the product. Absence is the norm, not the exception |
| 2 | Employment compliance | No written key employment terms, no itemised payslips, CPF contributed for pass holders or missed for new permanent residents | Sample five employee files and one payroll run. Check pass holders show no CPF and that SDL is paid for everyone |
| 3 | Statutory registers | Allotments never filed, controllers register never set up or never verified annually, charges undischarged | Compare the cap table to the Registrar’s register of members. Ask when controller verification notices were last sent |
| 4 | Founder loans and promises | Money put in without documentation; equity promised verbally or in an offer letter and never granted | Ask each founder directly, in writing, and reconcile to the ledger |
A. Corporate
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Unassigned founder IP, employment compliance, stale registers and undocumented founder loans account for most of what diligence actually finds in a Singapore company. Testing those four in the first week tells you whether the deal has a problem, before anyone has spent heavily on the rest.
Code, designs and brand created by founders before incorporation, or by contractors engaged without an assignment clause, belong to those individuals. Where the core product was built that way and a founder has since left on bad terms, the position may be very difficult to fix. Ask for the executed assignments, not a confirmation that they exist.
Every company will say it issues key employment terms and payslips. Take five employee files and one payroll run and check. The specific things to test: written terms issued within fourteen days, itemised payslips every period, CPF on the correct wage base, **no CPF for pass holders**, and SDL paid for everyone including pass holders.
For a private company, the register of members maintained by the Registrar is prima facie evidence of title. A spreadsheet cap table that does not match it is not the operative record. Allotments that were resolved but never filed are common, and the fix is administrative but must be done.
The register of registrable controllers must be maintained, filed centrally, and verified by notice at least once each calendar year. Many companies set it up at incorporation and never touch it again. The annual notice question is a fast way to find out whether the register is real or decorative.
A registrable charge not lodged in time is void against the liquidator — which affects the lender, not the target, but tells you something about the company. Undischarged charges over repaid debt obstruct future borrowing and are a straightforward pre-completion fix.
Money put into the company informally, and equity promised in a conversation or an offer letter and never granted, are both common and both surface after completion. Ask each founder in writing and reconcile to the ledger. A written no-claims confirmation at completion is worth having.
Where several convertible instruments are outstanding at different caps and discounts, the combined conversion frequently takes far more of the company than any single instrument suggests. Model it before agreeing a price, not after.
Inconsistency between the two is among the most common findings, usually because the Model Constitution was left in place while a bespoke agreement was negotiated. It produces resolutions that are valid under one and a breach of the other.
Investor side letters granting information rights, consent rights or most-favoured-nation terms are frequently absent from the data room because nobody thinks of them as part of the constitutional documents. Ask specifically.
Long-running consultants working full time under direction are employees in substance whatever the contract says, and the exposure — CPF arrears with interest, statutory entitlements — is retrospective. Sample the arrangements and apply the classification test.
Founders frequently register the brand and the domain in their own names before incorporation and never transfer them. It is easy to fix and easy to miss, and it becomes leverage if the founder leaves.
Copyleft licences can require disclosure of the company’s own source code. For a software target this is a genuine risk, and founders often do not know what is in the stack. Ask for an inventory rather than an assurance.
Not every issue needs an indemnity. A missing IP assignment should be fixed before completion; a quantified CPF arrears exposure suits a specific indemnity; an unknown general risk is what warranties are for. Using warranties for everything leaves known problems unresolved.
Reflects Singapore requirements current as of {{DATE OF USE}}. Filing deadlines, register obligations, employment and CPF requirements, GST and e-invoicing rules and data protection obligations all change — have legal and tax diligence conducted by advisers for any material transaction, and use this list to scope rather than replace that work.
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, corporate secretary, or accountant as relevant) before you rely on it.