Project Due Diligence is the process of analyzing all the factors related to the candidate projects, in order to identify proper methods and opportunities for developing them into viable reality. As far as decision-makers need a good understanding of a project’s predictability to ensure their investments are safe, a project due diligence is what can help to figure out the real situation behind the optimism and overconfidence peculiar to the most of project proposals. Project due diligence (audit) takes an integrated view considering all important factors which affect the project success – it is established to research all things that influence the project in economical, political or environmental terms.
Project Due Diligence embraces the following activities:
- Research of legal, logistic, workforce and accountancy conditions to assess the project’s legality and profitability.
- Proving availability of required project resources along with their quantities and capabilities as requested by the project plan.
- Research and evaluation of environmental conditions such as project risks.
- Examination of project goals, documents and assumptions, including the project plan.
- Checking whether project expenditures are adequate to the project plan and expected outcomes.