What a UKIYO AI diligence report actually looks like.
Below is an extract from an entirely fictional report, written to the same template and standards as a live engagement. No real company, person, transaction or client is depicted.
Important — this is a fictional illustration. "Northbridge Digital Infrastructure Ltd", its management, its customers, its financial figures and the transaction described below are invented for demonstration purposes only. They do not represent any real company, individual, transaction, client or engagement, and no client of UKIYO AI commissioned, reviewed or endorsed this example. Nothing on this page is investment, legal, tax or financial advice, an offer, a solicitation, or a representation about any actual business.
1 · Report administration & reliance
- Target
- Northbridge Digital Infrastructure Ltd (fictional) — UK
- Transaction
- Management buy-out, indicative enterprise value £10.0m
- Client
- Redacted — mid-market UK private equity
- Scope
- Commercial, operational, technology and key-person workstreams; integrity screen
- Information cut-off
- Illustrative date · sources dated within the 10-year research horizon
- Reliance
- Addressee only. No duty of care to any third party.
- Elapsed time
- 3 business days from receipt of complete data-room access
In a live engagement this section also records the full information-received log, the limitations of scope, the exclusion of audit, legal, tax and valuation opinions, and the identity of the senior reviewer accountable for the findings.
2 · Executive assessment
Northbridge operates a credible, cash-generative regional business in a structurally growing segment, with a management team that has delivered consistently against its own plan for three consecutive years. The commercial thesis is broadly supported by independent market evidence.
However, two findings are material enough to affect price or structure. First, revenue concentration is significantly higher than the information memorandum indicates once related entities are consolidated. Second, the platform's core scheduling engine has a single-vendor dependency whose contract falls outside the disclosed contract schedule and contains a change-of-control provision. Neither is necessarily a deal-breaker; both must be resolved before commitment.
3 · Red-flag register (extract)
| Class | Area | Finding | Evidence | Confidence |
|---|---|---|---|---|
| Critical | Commercial | Top-customer concentration is understated. Three customers presented as independent share a common ultimate parent per Companies House filings; consolidated, they represent an estimated 41% of FY revenue against the 22% shown in the IM. | VF | High |
| Critical | Technology / Legal | The core scheduling engine is licensed from a single third-party vendor under an agreement not included in the disclosed contract schedule. The licence contains a change-of-control clause permitting termination on 30 days' notice. | VF | High |
| High Risk | Operational | Delivery capacity is dependent on two senior engineers, neither of whom is subject to a post-termination restrictive covenant on the evidence provided. Neither is party to the MBO equity pool. | MR | Medium |
| High Risk | Financial | Working-capital seasonality is more pronounced than the normalised figures suggest; two of the last eight quarters show a peak-to-trough swing above the proposed facility headroom. | VF | Medium |
| Verification Required | Commercial | The renewal rate quoted by management could not be reconciled to the contract register supplied; the register appears to exclude two categories of month-to-month arrangement. | UN | Low |
| Verification Required | Technology | No penetration-test report has been produced for the last 24 months. Security posture cannot be assessed on the evidence supplied. | UN | Low |
| Positive Indicator | Market | Independent market data supports the growth rate in the plan for the target's two largest segments; the segment has grown ahead of the wider market in each of the last five reported years. | VF | High |
| Positive Indicator | Integrity | Beneficial ownership chain is clean and fully traceable. No adverse media, sanctions or PEP matches for the target, its directors or its ultimate beneficial owners. | VF | High |
A live register typically runs to 25–60 findings across the agreed workstreams, each with its own source references, owner and recommended action. Eight are shown here.
4 · Information gaps & management questions (extract)
- Provide the executed licence agreement for the scheduling engine, including all amendments and the change-of-control provision.
- Confirm the ultimate parent of customers A, B and C, and provide consolidated revenue by ultimate parent for FY-1 and FY-2.
- Provide the complete contract register, including month-to-month and evergreen arrangements, reconciled to the revenue ledger.
- Provide employment contracts for the two named senior engineers and confirm their treatment in the MBO equity arrangements.
- Provide the most recent penetration-test report and remediation log, or confirm that none exists.
- Provide monthly working-capital movements for the last eight quarters against the proposed facility.
5 · Recommended specialist investigations
The following matters fall outside UKIYO AI's scope and should be referred to appropriately licensed specialists before commitment:
- Legal counsel — review of the scheduling-engine licence, the change-of-control provision and the restrictive-covenant position on key personnel.
- Reporting accountants — quality-of-earnings work on the concentration restatement and the working-capital normalisation.
- Independent security testing — a current penetration test and remediation assessment.
6 · Decision, protections & action plan
| # | Action | Owner | Before |
|---|---|---|---|
| 1 | Obtain and review the scheduling-engine licence; price the replacement cost if termination risk is real | Buyer's legal counsel + UKIYO AI technology workstream | Exclusivity expiry |
| 2 | Restate customer concentration on a consolidated ultimate-parent basis and re-test the revenue plan | Reporting accountants | Final offer |
| 3 | Secure retention and restrictive-covenant arrangements for the two key engineers | Buyer + management | Completion |
| 4 | Consider a specific indemnity for the licence termination risk and a concentration-linked earn-out | Buyer's legal counsel | SPA drafting |
| 5 | Re-size the working-capital facility against observed peak-to-trough swing | Buyer + lender | Completion |
7 · Methodology & reliance statement
This report was prepared using UKIYO AI's seven-step controlled workflow: intake and conflict check, entity resolution, evidence collection, corroboration and source grading, analysis and risk scoring, drafting and four-eye senior review, and secure delivery. Findings are drawn from public and legally accessible sources together with information supplied by the client and the target.
The accuracy of any due-diligence exercise depends on the completeness, authenticity and availability of the information supplied. This report provides investment decision support. It is not an audit, a valuation, a fairness opinion, or legal, tax or regulated investment advice, and it does not replace formal opinions from licensed legal, financial, tax, regulatory, cybersecurity or technical specialists. UKIYOAI PRIVATE LIMITED accepts no duty of care to any party other than the named addressee of a live engagement. This page is a fictional illustration and creates no rights or obligations of any kind.
Four things that make a report usable at committee.
The decision is on page one
Go / Conditional Go / Hold / No-Go, the risk band and the reasoning — before any narrative.
Findings are classified, not listed
Critical findings are separated from noise, so the committee argues about the right two items.
Provenance is explicit
Verified fact, management representation, assumption or unconfirmed — with a confidence rating on each.
Gaps are declared
What we could not establish is named, with the exact questions to put to management next.
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