The Critical Role of Due Diligence
Due diligence can uncover unknown information, so thorough due diligence is important regardless of the transacting parties’ relationship, goodwill, or trust.
Due diligence can uncover unknown information, so thorough due diligence is important regardless of the transacting parties’ relationship, goodwill, or trust.
When considering acquiring another nonprofit, there are two types of acquisitions that are typically considered “ an asset purchase and a merger transaction. Several factors, including due diligence, payment of consideration, assumption of liability, assignment of contracts (including endowment agreements), existence of planned gifts, future operating goals and applicable state and federal laws, should be considered in determining the structure of the potential transaction.
Most states require you to register your organization if you solicit donations from their residents. Many states also require registration if your organization collects substantial or ongoing donations from their residents, even if you aren’t specifically targeting donors in that state. Download our comprehensive list of each state’s requirements.
Download our free guide to learn about the many elements needed to run a successful nonprofit organization, as well as how to avoid common pitfalls and mistakes.