Due Diligence

What is Due Diligence?

Due diligence is the investigation or auditing of a potential investment or product to confirm all facts, such as reviewing all financial records and contracts. The purpose of due diligence is to confirm the validity of all representations made by the vendor or issuer and to identify any risks involved in the proposed transaction. It is a comprehensive analysis of a company or asset, usually conducted before a major transaction, such as a merger, acquisition, or investment. Due diligence can encompass a wide range of activities, including financial analysis, legal review, market research, and operational assessments. The goal of due diligence is to make informed decisions by reducing risk and increasing the chance of successful outcomes.