noun

due diligence

dyoo DIL-uh-juhns

Due diligence (noun) means the careful investigation and checking a sensible person carries out before committing to something important, such as verifying facts, records and risks before a purchase or agreement. Example: “Do your due diligence before wiring a deposit to a landlord you have never met.”

noun

The careful investigation and checking a sensible person carries out before committing to something important, such as verifying facts, records and risks before a purchase or agreement.

"Do your due diligence before wiring a deposit to a landlord you have never met."

"A little due diligence would have shown the qualifications were fake."

In business and law, the formal examination of a company's finances, contracts, liabilities and operations before a takeover, investment or major deal.

"The acquisition collapsed when due diligence uncovered undisclosed debts."

"Their lawyers spent six weeks in due diligence."

The standard of reasonable care a person or organisation is legally required to exercise to avoid causing harm or breaking rules.

"The firm showed it had exercised due diligence in checking its suppliers."

How to use due diligence

Learner’s notes

In plain EnglishIt means checking something out properly before you commit to it.

When to use it

Uncountable, so it takes no article in most uses: do due diligence, not do a due diligence. Common in both everyday and legal contexts; "do your due diligence" is the ordinary spoken form.

Memory tip

Say "do due diligence on the seller", using on to introduce whatever is being checked.

Common pairings

do your due diligence conduct due diligence due diligence process financial due diligence

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Fill the gap

Can you complete this real example?

Do your _____ before wiring a deposit to a landlord you have never met.

Synonyms

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Related words

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Rhymes for due diligence

hence fence whence thence Spence valence absence science silence defence essence ambience

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Frequently asked questions

What does it mean to do your due diligence?

It means investigating properly before you commit: checking the facts, the paperwork and the risks yourself rather than trusting what you have been told. In everyday use it covers anything from vetting a landlord to researching a used car.

What is the difference between due diligence and an audit?

An audit is a formal check that financial statements are accurate and comply with accounting standards, usually done annually. Due diligence is broader and forward-looking, examining contracts, staff, legal risk and prospects to help someone decide whether to go ahead with a deal.

How long does due diligence take on a business deal?

For a small acquisition it can be a few weeks; for a large or cross-border one it often runs for several months. The timetable is usually written into the agreement, with the buyer able to walk away or renegotiate if problems surface.

What is the meaning of due diligence?

"due diligence" (noun) means the careful investigation and checking a sensible person carries out before committing to something important, such as verifying facts, records and risks before a purchase or agreement.

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