A buyer pays for the business it can verify. During due diligence its lawyers and accountants read your company's records line by line, and each gap they find gives them a reason to lower the price, hold back part of it or ask for a wider indemnity. You can close most of those gaps before a buyer arrives, for a fraction of the cost of closing them against a deadline.

Start with the company's own records

Check the statutory books first. The register of members, the share certificates and the filings at Companies House should agree with each other and with the people you believe own the company. Share issues and transfers made years ago without the right board minutes or stamp duty are common, and a buyer will want them put right before completion.

Next, gather the documents that prove the company owns what it uses: title to any property, leases, registered trade marks, domain names, and assignments of intellectual property from the founders, employees and contractors who created it. Software written by a freelancer belongs to the freelancer unless a written assignment says otherwise.

Review the contracts the business trades on

List your ten largest customer and supplier contracts and read them for change of control clauses. Some let the other side end the contract if the company is sold, and a buyer will price that risk in. Find out now, so you can talk to those customers on your own terms.

Look at the employment paperwork in the same way. Each employee should have a signed contract, and senior staff should have restrictive covenants that a court would enforce. Unwritten bonus promises and share options agreed in an email cause disputes at the worst moment.

Disputes, regulatory correspondence and tax enquiries belong on the list as well. Settle what you can. For the rest, keep a clear file, because you will need to disclose it.

Prepare for warranties and disclosure

The sale agreement will ask you to give warranties: statements about the company that the buyer can claim on if they prove untrue. You protect yourself by disclosing against them, in a letter that sets out each exception in detail. A prepared seller drafts most of the disclosure letter before heads of terms are signed.

Agree a timetable with your accountant too. Clean management accounts, a tax position with no surprises and a realistic forecast shorten due diligence and keep the buyer's attention on the business.

Start this work twelve months before you plan to sell. It costs less, it reads better to a buyer, and it leaves you free to negotiate the price instead of defending it.

This briefing is general information, not legal advice.