Due diligence serves to confirm all material facts in regards to a transaction. Generally, due diligence refers to the care a reasonable person should take before entering into an agreement or a transaction with another party
It is an investigation into the facts connected with an organization, an initiative, or a process, normally in respect of the customer or prospective customer. It can be part of the Know Your Customer (KYC) process. In existing agreements, it is normally applied toa portfolio of debtors to check the outstanding invoices.