A due diligence checklist gives lawyers a framework to collect, comprehend and evaluate information gathered during complex or simple legal processes. It can be utilized for M&A or vendor onboarding, or customer due diligence helping to ensure anti-money laundering (AML) and know-your-customer (KYC) compliance, a due diligence checklist can improve efficiency, provide better client service and ensure that important information is not overlooked.

A good due diligence checklist focuses on the most important areas of a business transaction and the documents that pertain to each one. This allows the person who is reviewing of the due diligence checklists to pinpoint any legal issues that might arise from the merger or purchase and determine if the purchase is worth the effort.

Due diligence should include an examination of intellectual property, contracts and compliance with the laws. Also, it should include checks on the financial stability of the vendor, including credit and checking statement reports, and evaluating the capacity and capabilities of the company. A company due diligence checklist must also consider the treatment of employees, including reviewing pay and benefits and accrued vacation time, and determining if the company adheres to environmental standards.

Due diligence should also include screening third parties against the lists of law enforcement agencies such as Interpol or the FBI or the National Crime Agency of the UK as well as any other countries that are associated with them for signs of money laundering, terrorist criminality or corruption. This is especially crucial when dealing with high-net-worth people known as PEPs. In addition to reviewing the documentation and due diligence, a thorough review should also include interviews with key suppliers and stakeholders to learn about the company’s culture and the challenges facing it.

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