What "no adverse findings" actually means
· 2 min read · דניאל מעוז
The most misread line in any diligence report. It is not a clearance, and its weight depends entirely on where the search was run.
A due diligence report that ends in "no adverse findings" reads like a green light. It rarely is one, and the difference is worth understanding before a signature depends on it.
The line means one thing only
It means: in the sources searched, within the scope agreed, nothing surfaced. It does not mean nothing exists. Those are different statements, and the gap between them is entirely a function of where the search ran.
Why jurisdiction changes the weight
In Delaware, litigation history is indexed, searchable and near-complete. In several jurisdictions we work in routinely, corporate filings are not digitised, court records are not public, and press archives are partial. "No findings" in the first case is meaningful. In the second it is close to uninformative.
A report that does not tell you which sources it could not reach has not finished the job.
What to ask for
Ask for the negative space: which registries were searched, which were unavailable, and what the residual risk is as a result. A good report states this without being asked, and grades findings by severity rather than listing everything at equal weight.
Timing
Standard diligence takes five to ten business days. Compressing it to two does not halve the cost of the risk — it just moves the risk to the part nobody looked at.
These articles are general information and are not a substitute for specific advice. The law differs between jurisdictions, and every matter is assessed on its own facts.