A due diligence report template matters more than it looks, because the difference between a useful report and a long one is structural rather than editorial. A committee has to be able to act on it in an hour: what did you find, how much does it matter, what should we do about it, and what did you not look at. Four parts. This page sets out the four and the field most reports leave out.
Part one: findings, each with an impact and an owner
A finding with no number beside it is an observation, and a committee cannot act on observations. Each one needs an estimated impact, even a rough range, and a proposed treatment: price, indemnity, condition, or accept. The treatment column is the field most reports leave out and the one the meeting is actually about.
Part two: the summary, written last and read first
Half a page naming the three findings that matter and the recommendation. If a reader cannot get the shape of the deal from the summary alone, the report will be read selectively by people in a hurry, which produces decisions made on whichever section somebody happened to open.
Part three: the work performed, stated plainly
What was examined, over what period and from what sources. This is the part that makes the report defensible later, and it is short. A reader in eighteen months needs to know whether a question was asked and answered or never asked at all.
Part four: scope limitations, which protect everybody
What was not examined and why: refused access, insufficient time, an area outside the engagement. Recording it is not defensive, it is the only way the committee can tell the difference between a clean finding and an unasked question.
Questions people ask about due diligence report template
What makes a diligence report useful?
Each finding carrying an estimated impact and a proposed treatment: price, indemnity, condition or accept. Observations cannot be acted on.
What is most often missing?
The treatment column, and the scope limitations. Without the second, a committee cannot tell a clean finding from an unasked question.
How long should the summary be?
Half a page naming the three findings that matter and the recommendation. It is written last and read first.