How to Prepare for an Investor Due Diligence
Create a Data Room in Google Drive, Sharepoint or Dropbox with the following folders.
1. Financial (FDD): past financial statements, MIS reports, audit reports, calculations, details of assets & liabilities, expense summaries and evidences
2. Legal (LDD): Minutes of Board Meetings, General Meetings, MCA Filings, Labor Law Returns, Agreements with Vendors, Employees, Registration Documents, IP related documents, Insurances, etc
3. Tax: GST and Income Tax Returns, notices, appeals, calculations, reconciliations, etc
4. Commercial: Internal SOPs, Competitor Data, Market Analysis, Organizational Chart
It’s best to get a professional to do a DD in house and prepare for the external DD. Such professional CA may also be the SPOC for the transaction to deal with the DD team.
