Diligence gap · On both sides
Who checked what in a small-business sale?
Published · Reviewed by The Diligence Standard Team · Updated
There is no universal transaction participant who automatically verifies the entire business. Each person works for a client, purpose and scope. The reliable approach is to map every material claim to the evidence examined and the person responsible for testing it.
A realistic transaction story
In one acquisition, the broker reviewed seller statements, the lender analyzed repayment, the attorney reviewed contracts and the accountant advised on taxes. Everyone performed useful work. Nobody had been assigned to test customer retention or the owner’s true operating role.
What the evidence changed
Professional involvement created confidence, but the unanswered claims remained outside every engagement.
What to check
- Write down the exact claim and who supplied it.
- Ask what was independently tested, by whom and under what scope.
- Maintain a claim-to-reviewer matrix showing scope, evidence, conclusion, exclusions and unresolved follow-up.
- Translate any unresolved gap into cash, price, terms, timing or a decision not to proceed.