Buying a Business - Due Diligence

If you are planning on buying a business and need a CPA, below is the information that our firm will request from the seller to substantiate his or her financial representations. The list is general and will change depending on the industry in which the business operates, how much the purchaser would like to see of the target business and whether or not the business is a public company.  

buying-a-business-180.jpg

  • Tax Returns for 3 years
  • Profit and Loss statements for 3 years
  • Bank Statements 2 years
  • Sales Tax Returns 2 years
  • General Ledger current plus 2 years
  • Copy of current lease and any addendums
  • Payroll Tax returns 2 years plus current
  • Employee List, Rate of Pay and Job Functions
  • Insurance Policies
  • Property, Plant & Equipment Listing
  • Tangible Tax Returns
  • Articles of incorporation. Minutes
  • Contracts & Joint Venture Agreements
  • Summary of labor disputes
  • List of pending litigation

If the company is publically traded, then you should also request:

  • Sample copies of stock certificates
  • Stock Register, Proxies
  • Stock options & stock purchase agreeements
  • list of outstanding warrants and stock options
  • Buy/Sell Agreements, Voting Trust Agreements, Convertable Debt Instruments
  • Government Regulations & Filings