What is due diligence?

   Due diligence is an important process for acquiring and analyzing information to help a buyer or seller determine whether or not to proceed with a proposed business transaction. The information obtained relates to all aspects of the business being purchased. Due diligence includes quantitative information, such as sales and other financial data, and qualitative information, such as an assessment of the existing management, internal systems, existing licenses, location and other matters. Sometimes the information to be reviewed can be quite technical or industry specific, therefore it is important that the person doing due diligence have an understanding of the information being reviewed.