Helping a Startup Client Pass Diligence: A CA's Prep Checklist

When a startup client is heading into a round, the advisor who gets them diligence-ready before the term sheet delivers outsized value — and the work is mostly assembling and reconciling what should already exist. This is a CA/CS prep checklist: the filings to bring current, the documents to gather, and the three places founders reliably trip up. It's also a productisable service line, not just a favour.

Why diligence prep is a distinct engagement

A standard retainer keeps recurring filings current. Diligence prep is different: it's a point-in-time exercise to make sure that everything reconciles and is producible on demand, across domains your monthly work may not touch — corporate records, equity documents, IP, FEMA. Founders assume "our CA handles compliance" means "we'll pass diligence." Those aren't the same, and the gap is where you add value.

The prep checklist

Bring filings current

• ROC annuals — AOC-4, MGT-7 for every year; clear any backlog.
• DIR-3 KYC active for all directors (a deactivated DIN blocks every filing).
• GST and TDS returns filed and reconciled; TDS deducted and deposited.
• FEMA — every FC-GPR filed within 30 days of each foreign allotment, and the annual FLA for every year. This is the most commonly missed cluster — see the FEMA-for-CAs checklist.

Assemble and reconcile the records

• Cap table reconciled to PAS-3 for every allotment — the spreadsheet must match the filings.
• Board/shareholder minutes and statutory registers complete.
• Equity documents — SHA, SSA, term sheets, share certificates, ESOP plan and grants.
• Valuations — current Rule 11UA reports supporting prior issues.

Close the legal gaps

• IP assignments from founders, employees and contractors (why this matters).
• Employment agreements with IP/confidentiality clauses; material contracts gathered.

Where founders self-sabotage

Three patterns to pre-empt with every client:

1. The cap-table spreadsheet that doesn't match the filings — usually a late or missing PAS-3. Reconcile early; it takes time to fix.
2. The FEMA blind spot — they took foreign money and assume the round paperwork covered it. It didn't; FC-GPR and FLA are separate and often late.
3. The contractor IP no one assigned — a freelancer built a chunk of the product years ago and was never asked to sign. Hard to fix late.

Catching these months ahead is the difference between a clean diligence and a scramble.

Run diligence prep across your whole client book

ComplianceStack lets you onboard the startups you serve, run the same Red/Amber/Green diligence checklist over each one, bring filings current, and export an investor-ready diligence pack per client — one control room across your book, with evidence stored centrally and access that stays scoped and revocable. See how partner onboarding works.