Free Childcare Due Diligence Checklist54 Initial Operational Questions Every ECE Buyer Must Ask
Buying a childcare centre is not a numbers exercise — it’s an operational risk decision.
Most first-time ECE buyers rely on financials, occupancy, and broker summaries. That approach misses where deals actually fail: compliance gaps, staffing instability, and weak operational systems.
This checklist is built from real due diligence work across hundreds of childcare acquisitions. It is designed to force the right conversations early — before you commit capital.
Use it as a working document. If you cannot clearly answer these questions with evidence, you are carrying risk.
Checklist: Licensing, Compliance & Property
☐ Sight a current copy of the licence, and does it reflect actual operations?
☐ Is the Building Warrant of Fitness current and valid?
☐ Is the fire evacuation scheme approved and current with Fire and Emergency New Zealand?
☐ Is the resource consent valid and aligned with the current use of the centre?
☐ Review local council complete property file
☐ Is the food registration certificate (or NP2) current?
☐ Are annual plans in place and documented?
☐ Are the last 24 months of emergency drills (no more than 4 months gap) completed and properly evaluated?
Checklist: Staffing, Contracts & Workforce Risk
☐ Are all employment agreements current, signed, and complete?
☐ Are all teacher qualifications verified (ECE vs primary)?
☐ Are there any undocumented staff arrangements (reduced hours, allowances, special conditions)?
☐ Are all safety checks compliant with the Children’s Act 2014?
☐ Are staff induction processes documented (both operational and health & safety)?
☐ Are there any known staffing risks (maternity leave, resignations, shortages)?
☐ Are there any disciplinary issues or unresolved staff concerns?
☐ What commitments have been made around pay parity or remuneration increases?
☐ How is non-contact time structured and delivered?
☐ How many hours of non-contact time are provided weekly, and is it onsite?
☐ How frequently are staff meetings held, and are they paid?
☐ What roles and hours do the current owners contribute to operations?
Checklist: Revenue Quality & Financial Reality
☐ What does the current debtors report show (including aged debt)?
☐ What does the frequent absence report indicate?
☐ What do RS7 funding reports show for the last 4 months?
☐ What do RS7 projections show for the next 4 months?
☐ What is the current age mix of children enrolled?
☐ What is the expected movement of children over the next 90 days (starts and leavers)?
☐ Are the last three funding notices consistent with reported revenue?
☐ What is the current fee schedule?
☐ When was the last fee increase, and by how much?
☐ What is the weekly value of invoices raised (GST inclusive/exclusive)?
☐ What actual banked revenue was received in the most recent week?
☐ Which families are receiving discounts, and at what level?
☐ Are staff receiving childcare discounts?
☐ Are attendance records accurate and signed weekly (manual or system-based)?
Checklist: Operations, Rostering & Delivery Model
☐ How is the roster constructed, and who is responsible?
☐ What ratio assumptions are used when building rosters?
☐ Are staffing levels above minimum ratios, and if so, why?
☐ What external agencies or relievers are used, and how frequently?
☐ How are relievers recorded and costed within rosters?
☐ What training is provided to “Persons Responsible”?
☐ What does the latest monthly attendance report show (attendance vs absence vs holidays)?
☐ Are menus completed, signed, and compliant each week?
☐ Are food register records consistently maintained?
☐ Are enrolment forms current and compliant?
☐ What is the centre’s philosophy, and how is it implemented in practice?
Checklist: Health, Safety & Risk Exposure
☐ Is there a current and actively used hazard register?
☐ Is the medicine register complete and up to date?
☐ What maintenance issues have been identified but not resolved?
☐ Are there any known gaps in equipment or learning resources?
☐ What do the last two months of incident/accident records show?
☐ What was the last notifiable incident reported to the Ministry of Education?
☐ Are there any known areas of operational non-compliance?
☐ Are there any building or facility compliance issues?
☐ Are there any neighbour complaints (noise, traffic, parking)?
☐ When was the last Ministry visit, and what was the outcome?
Checklist: Final Disclosure & Asset Position
☐ Is there anything not yet disclosed that could materially impact operations?
☐ What equipment is leased versus owned?
☐ What items are owned by staff and may be removed?
☐ What items are landlord-owned chattels?
☐ What would the current owner change if they had the opportunity?
☐ Are all policies and procedures complete and accessible?
☐ Has a high-level EC3C assessment been completed?
Final Word
This checklist is not exhaustive — but it will expose many operational risk early.
If a vendor cannot answer these clearly, or documentation does not support the answers, assume there is a problem until proven otherwise.
This is exactly where professional due diligence creates value — identifying issues before they become your liability.
To find out about a comprehensive Due Diligence process reach out to Jo or Gavin at Astute Education.
