How and Why is a Legal Due Diligent or Legal Audit conducted?

Due diligent or legal audit is an investigation of a business or individual and is a form of good faith carried out before the parties wishing to cooperate make an agreement. In the world of health, it is often called a medical check-up, which is a comprehensive health examination through this examination, it is hoped that a disease or health problem can be detected early. In the banking world, due diligence is often referred to as Know Your Customer (KYC), which is the process by which banks obtain factual information on customer identities. The goal is for banks to avoid the risk of abuse for criminal acts and to understand their consumers. In the business world, we know the term Know Your Vendor (KYV), which is due diligence on vendors with the aim of finding out the performance of potential vendors, track records, and legal status, among others.
This good faith becomes the foundation in a cooperation agreement stated in Article 1338 paragraph 3 of the Civil Code. In other words, good faith is an important point in legal and universally recognized cooperation. Good faith will also give legal force to the parties who make the agreement if something undesirable happens while the cooperation contract is in effect.

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