Due diligence can be explained as taking reasonable steps in order to satisfy the legal requirements with respect to the sale of your business. When you are selling a business, your due diligence is not only expected, it is often required. In order to ensure you have done your due diligence you may need to bring in a few experts to check and confirm your facts. During the process of due diligence a variety of documents and information should be collected, created, prepared and provided. These documents may include but are not limited to:

• Certificate of incorporation
• Employee policies
• Operations manual
• Proforma and segmented financial statements
• Canada Revenue Agency or Internal Revenue Service documents
• Organized Statements related to income or expenses
• Documents defining the organizational structure
• Value assessment for held equity and real estate
• Client books and affiliate info
• All current contracts, agreements and licenses
• All owned technology or intellectual property
• Any legal liability related to business or ongoing legal proceedings
• Any sales kits or marketing materials
• Records of incidents and insurance policy information

As a buyer, having all of this prepared provides confidence and is a definite factor when they are making their final decision. Your due diligence will serve as proof that the company is in good standing and despite the time it will take to prepare, it will likely fast-track your sale process to have the information prepared and ready.