When dealing with large quantities of sensitive files due diligence is essential for all involved. Due diligence files are typically stored in cabinets which can only be accessed by people with physical access. This method isn’t scalable when dealing with large amounts of data or multiple transactions. A virtual data room (VDR) allows several interested parties to read and comment on sensitive documents without having to make copies that could reveal confidential information. A VDR is used to conduct due diligence in M&A transactions, litigations and bankruptcy.
A VDR’s structure for files is easy to navigate, and the files are organized based on the type of project or stage. The structure of the folders can be customized to suit the requirements of various industries and projects. The software includes the default index of files that reflect the due diligence checklist. This helps users locate the required documents quicker.
To ensure that no one is able to gain access to private information without authorization to do so, the VDR should have all security features. This includes 256-bit encryption remote shredding, dynamic watermarks restricted viewing mode and secure spreadsheet view, comprehensive activity reporting and click for info antivirus protection. It should also permit you to restrict the ability to download and print documents and limit how long users can spend watching a screen or document. Different providers have different security features, so be sure to compare their features before selecting the best one.