Due Diligence Checklist for a Business Acquisition (2026)

What due diligence is for, in one line Due diligence is the buyer's structured investigation of a target business before completion, run to confirm what is being bought, find the risks, and feed three decisions: whether to proceed, at what price, and with what protections (warranties, indemnities, conditions and price adjustments) in the purchase agreement. A good diligence exercise is not a box-ticking read of a data room; it is a hunt for the handful of findings that change the deal. Use the checklist below as the request list and the review map, and treat every red flag as either a price point, a specific indemnity, or a reason to walk away. This article is general guidance, not legal advice. The law here varies by jurisdiction, so have a qualified professional review your specific deal before you rely on it. ## The workstreams and what to request ### 1. Corporate and constitutional

Request the certificate of incorporation, constitution or articles, statutory registers, share capital history, cap table, options and any shareholder agreements. Confirm clean title to the shares or assets being sold, that all issuances were valid, and that there are no undisclosed rights (options, warrants, convertibles) diluting what you buy. ### 2. Financial and tax Request audited and management accounts, the current year's figures, debt and facility agreements, guarantees, and the full tax history (filings, assessments, disputes, transfer-pricing, and in India GST, TDS and any tax demands). Look for off-balance-sheet liabilities, aggressive revenue recognition, customer concentration, and any open tax exposure that belongs in a tax indemnity. ### 3. Material contracts Request the top customer and supplier contracts, financing, leases, licences, and anything with a change-of-control clause. Change-of-control and assignment clauses matter most: a key contract that terminates or needs consent on a sale can change the value of the whole deal. Note the term, termination rights, exclusivity, and any onerous obligations. ### 4. Employment and people Request employment contracts for key staff, the standard template, benefits, bonus and option schemes, contractor arrangements, and any disputes. Check restrictive covenants on founders and key employees, misclassification risk, accrued liabilities (gratuity, leave, provident fund in India), and whether key people are tied in post-deal. ### 5. Intellectual property and IT Request the IP register, assignments from founders, contractors and employees, licences in and out, open-source usage, domain names, and data and cyber posture. The classic red flag is IP that the company uses but does not actually own because it was never assigned. For technology targets, confirm the code and data chain of title. ### 6. Data protection and privacy Request the privacy policy, records of processing, data-transfer arrangements, consent mechanisms, and any breaches or regulator contact. In 2026 this is a live diligence area under the EU GDPR, the UK GDPR and India's Digital Personal Data Protection Act, 2023, among others, and the regimes vary by jurisdiction. ### 7. Litigation, disputes and compliance Request current and threatened litigation, regulatory investigations, correspondence with regulators, and the compliance framework (anti-bribery, sanctions, sector licences). Each live dispute is a candidate for a specific indemnity. ### 8. Property and assets Request leases, title documents, and the fixed-asset register. For leased premises, check assignment and change-of-control terms and any estoppel or consent needed from landlords. ### 9. Insurance Request the policy schedule and claims history, and confirm cover continues (or can be replaced) after the deal, including run-off cover where needed. ## A compact request-and-risk table | Workstream | Key request | Classic red flag | |---|---|---| | Corporate | Cap table, share history | Defective issuances, hidden options | | Financial/Tax | Accounts, tax filings | Undisclosed tax exposure | | Contracts | Top contracts | Change-of-control termination | | People | Key contracts, covenants | Unassigned IP by contractors, misclassification | | IP/IT | IP register, assignments | Company does not own core IP | | Data | Processing records | Non-compliance, past breach | | Disputes | Litigation list | Live claim with no indemnity | ## How findings flow into the deal Every material finding should land somewhere: a price reduction, a completion-accounts adjustment, a condition precedent (fix it before closing), a specific indemnity (seller pays if the risk bites), a warranty (seller stands behind the facts), or a walk-away. Diligence that produces a long report but does not feed the agreement has failed. Keep a running issues list that maps each finding to its treatment. ## A note on jurisdiction The workstreams are universal, but the specifics change by jurisdiction: tax heads, employee entitlements, data-protection regimes, foreign-investment approvals, and the transferability of licences all differ across IN, UK, IE, SG, AU and the US. Cross-border acquisitions add competition clearances and investment screening. Scope the checklist to the target's footprint and confirm local points with counsel. ## Where one contract workspace helps Due diligence generates a mountain of documents and a long issues list, and the value is in connecting each finding to the clause in the purchase agreement that deals with it. Holding the requests, the documents, the findings and the agreed treatment in one place, rather than across folders, emails and spreadsheets, is the hard part. Reading a target's documents clause by clause, marking each position as favourable, neutral or unfavourable to your company, surfacing red flags and key dates, and tracking what still needs fixing can live in one AI contract workspace tuned to your company, so reviewing, editing and tracking become one connected job. Adira is one workspace built to connect diligence findings to the agreement this way. The checklist above is enough to work through a document on your own.