DDQ Questionnaire
DDQs (Due Diligence Questionnaires) are a formal document that helps an investor or manager gather important information from a potential manager, vendor, or investment. These documents can help identify red flags, uncover possible risks, and assess whether an investment is worth the risk. Due diligence is a complex process, and getting the right information at the right time can make or break a venture.
DDQs are typically used for vendor risk management, but can also be part of the sales or mergers process. Depending on the deal type, a DDQ may include a number of categories, such as financial, operational, IT, and security. A DDQ can be a standalone document or a document that is included in an existing document. In either case, a digital due diligence checklist can be a great tool for cross-comparison.
The Institutional Limited Partners Association (ILPA) has a DDQ that can be customized to meet your company’s specific needs. The ILPA DDQ includes 14 critical areas that cover a wide variety of real-world issues. It can be used to provide basic information about a vendor, as well as information about a company’s current contract obligations. However, a DDQ should not be considered a substitute for a thorough dialogue between an investor and a manager. During the process of developing the DDQ, the investor and manager must determine whether it meets their standards. They may choose to accept a previously-prepared DDQ or may ask for new responses in writing.
AITEC-AIMA created a Due Diligence Questionnaire in 2014, which has been widely adopted by over 150 global vendors. The questions have been developed by experts in technology and operations, and the content is available to AITEC and AIMA members exclusively. The DDQ has received recognition for its content.
What is a DDQ Questionnaire?
The in-depth INREV DDQ was developed to provide investors and consultants with a comprehensive tool for assessing a non-listed real estate vehicle’s strategy, risk processes, and management. It is easy to use, and promotes best practices and knowledge sharing. It also advocates for transparency in the non-listed real estate industry.
The Principles for Responsible Investing (PRI) has an example DDQ that outlines the process of creating a questionnaire and provides an overview of the development process. The organization has been established by investors to promote incorporation of social and environmental factors into the investment process. The DDQ can be downloaded in Word format, and contains questions that are helpful for identifying risks.
A DDQ can be used before and after an investment. It can help the organization monitor its compliance with applicable laws and regulations, and maintain its best practices. It can also be used to analyze a vendor’s network security. This can be done in order to ensure that the organization is prepared for network disaster. It is also a useful tool for businesses that are considering an investment in a vendor.
The Wolfsberg Group has developed a DDQ for public sector organizations, as well as a DDQ for correspondent banking. These questionnaires include questions about banking compliance and documentation requirements. There are versions in both English and Spanish, as well as guidance documentation.