EDDC04010 - General

When testing a business’s due diligence you should challenge and consider whether the procedure:

• fully identifies all major trading risks
• provides options to address and reduce the effect of risks
• is dynamic enough to identify and react to new risks
• evaluates risks effectively

You should also establish whether the business has:

• gathered credible and reliable information to support its risk assessment (oral or documented)
• reached reasonable conclusions and reacted proportionately to the results of checks
• reasonably addressed any concerns notified in earlier due diligence correspondence

The business should react positively to risks under the following “FITTED” risk areas, considering results as a whole:

• Financial health of the business they will be trading with EDDC04020
• Identity of the business they are trading with EDDC04030
• Terms of contract, payment and credit agreements EDDC04040
• Transport EDDC04050
• Existence/provenance of goods EDDC04060
• Deal EDDC04070