Day 1 Readiness Checklist

Executive summary

A Day 1 readiness checklist is a written register of the things that must work on the first day the combined business operates, each with an owner, a test, and a go or no-go status. It is not a communications plan. The announcement can be flawless and the deal can still lose trust in week one if payroll is late, a supplier is not paid, or a customer cannot place an order.

The risk is measured by dependencies, not by a formula. Count what must happen on Day 1 for people to be paid, cash to be received and applied, vendors to be paid, orders to ship, and decisions to be authorized. Each is a single point of failure until someone has tested it.

The first move is to build the register at least a few weeks before close, name an owner for every line, and agree who has the authority to call a no-go. This checklist feeds the PMI Playbook: Day 1 to Day 365, and what you learn here shapes the TSA, IT, and people workstreams.

When to use this

Use this checklist when:

• You have a signed acquisition, merger, or carve-out with a defined closing date.
• You are a platform bringing on an add-on and want a repeatable gate for each one.
• You are an operator who will inherit a business and needs to know what must work on the first morning.

Do not treat it as legal advice or a closing checklist for the transaction itself. The purchase agreement, regulatory filings, funds flow, employment transfers, benefits enrollment, tax registrations, insurance, and lender requirements are set by your agreements and your counsel and advisers. This checklist covers the operational layer around them, and it flags where a legal or adviser sign-off is the owner's responsibility to obtain.

It is also less useful where the acquired business will run entirely standalone with no shared systems. In that case, narrow the register to the items where the two businesses touch: ownership, reporting, banking, and authority.

Diagnostic questions

Answer these about three weeks before close. Any "no" or "don't know" becomes a register line.

1. Which employees are paid by which entity on Day 1, through which payroll system, and has a test run been done?
2. Which bank accounts will receive customer cash on Day 1, and do customers know where to pay?
3. Who can approve and release payments on Day 1, and are signatories and bank mandates in place (with counsel and the bank confirming the legal mechanics)?
4. Which vendors must be paid in the first 30 days, and are they set up in the paying entity's system?
5. Can customers place orders, receive invoices, and see correct remittance details on Day 1?
6. Which systems must continue working unchanged on Day 1, and what does the TSA or access agreement guarantee?
7. Who has access to which systems after close, and who must lose access?
8. Who has authority to commit spend, sign contracts, set prices, and approve credit on Day 1?
9. Which customers, suppliers, and employees are critical, and who will contact each before or on Day 1?
10. Which consents, notices, or approvals from lenders, landlords, customers, or regulators are required, and are they received?
11. How will insurance, benefits, and facilities access continue without a gap?
12. Who runs the Day 1 command center, and who has the right to declare an item no-go?

The framework: five gates

Group the register into five gates. A gate is a set of items that must be green before the next matters.

Gates 1 to 3 are operational. Gate 4 is control. Gate 5 is where the announcement lives. The order matters: a perfect message about a business that cannot pay people damages trust more than a modest message about one that runs.

Step-by-step process

1. Build the register (T minus 4 weeks). List every Day 1 dependency under the five gates, with owner, test, due date, and status. Owner: integration lead. Output: register shared with all owners.
2. Define the go or no-go rule (T minus 4 weeks). Decide which items are mandatory for go (for example, payroll and payment release), who decides, and what the fallback is for each. Owner: CEO. Output: written rule with a named decision-maker.
3. Test the money flows (T minus 3 to 2 weeks). Run payroll in test or parallel, verify bank account details with a call-back to a known contact, test a small payment release, confirm customer remittance information. Owner: CFO and treasury. Output: test evidence for each item.
4. Confirm authority and access (T minus 2 weeks). List signatories, approval limits, and system access by role. Owner: CFO and CIO, with counsel on the legal authority. Output: authority matrix and an access list.
5. Prepare communications (T minus 2 weeks). Draft messages by audience, with legal review of content that has contractual or regulatory effect. Owner: CEO with HR and commercial leads. Output: approved messages, a sequence, and a Q&A document.
6. Brief key people and accounts (T minus 1 week to Day 1). Personal contact for the critical list, within the confidentiality limits counsel sets. Owner: CEO and workstream leads. Output: contact log.
7. Hold the readiness review (T minus 3 days). Walk the register; every red item has a fix, a fallback, or an explicit decision to proceed. Owner: integration lead and CEO. Output: go or no-go record.
8. Run the Day 1 command center. One room or channel, one exceptions list, fixed check-in times. Owner: integration lead. Output: exceptions list closed out daily.
9. Review Day 1 and week 1. Log what failed and why, update the register template for the next deal. Owner: integration lead. Output: lessons list and handover to the 30-day plan.

The register: items by gate

Gate 1: People paid

Gate 2: Cash flows

For a first-weeks liquidity view, see the 13-week cash flow forecast template.

Gate 3: Business operates

Gate 4: Authority and access

For the TSA, see Transition Services Agreement (TSA) Management and, for systems, IT Integration in Post-Merger Integration.

Gate 5: Trust protected

Templates

Readiness register (copy into a spreadsheet)

Go or no-go record

Day 1 command-center rhythm

Run the rhythm daily in week one, then three times a week through Day 30, if the exception list is short.

Metrics and KPIs

Setting targets without invented benchmarks. For mandatory items, the target is all green or an explicitly accepted fallback; that is a binary standard, not a percentage. For error and exception metrics, compare against the acquired business's own pre-close performance (pay errors, order exceptions, application lag in the three months before close). The Day 1 standard is "no worse than before," measured with the same definitions.

Common mistakes

1. A communications plan masquerading as a Day 1 plan. Symptom: detailed message grid, no payroll test. Fix: gates 1 to 3 first.
2. Untested bank and payment changes. Symptom: a vendor or payroll payment goes to a wrong or inactive account. Fix: call-back verification and a test payment. Treat bank-detail change requests as a fraud risk.
3. No named no-go authority. Symptom: red items debated the night before close. Fix: a decision-maker and written mandatory list.
4. Authority left implicit. Symptom: two managers approve conflicting spend, or nobody does. Fix: an interim authority matrix.
5. Access granted in bulk. Symptom: everyone has everything on Day 1, or nobody can work. Fix: role-based access and an access review.
6. Customers learn from the press release. Symptom: top accounts call in confused. Fix: personal contact on the critical list.
7. Counsel looped in late. Symptom: employment, consent, or notice requirements discovered after the fact. Fix: counsel reviews the register early.
8. No fallback. Symptom: a failed integration of a system stops the business. Fix: a manual fallback for every mandatory item.

Worked example (illustrative)

The following example is made up to show the register and a no-go decision. It describes no real company.

A platform acquires a small services company. Three weeks before close the integration lead builds a register of 42 items across the five gates. Of these, 11 are marked go or no-go critical: payroll, payment release, customer remittance details, bank-detail verification, order entry, signatory authority, system access for finance, key-person contact, key-account contact, insurance, and the TSA service contacts. Counting by gate: gate 1 has 8 items, gate 2 has 10, gate 3 has 9, gate 4 has 8, and gate 5 has 7, which sums to 8 + 10 + 9 + 8 + 7 = 42.

At the T minus 3 day review the register shows 36 green, 4 amber, and 2 red. That is 36 + 4 + 2 = 42. Of the 11 critical items, 9 are green, 1 is amber, and 1 is red.

The red critical item is payroll: the parallel run for hourly employees did not match expected net pay for one pay group because of a different overtime rule. The CEO's go or no-go rule says payroll is mandatory. The team has three options: fix the rule before close, pay that group manually for the first cycle from a verified file reviewed by HR, or delay the transfer of that group under an arrangement counsel confirms is permitted. They fix the rule, rerun the parallel test, and record the evidence. If the fix had failed, the manual fallback with an HR and finance review of every payment was the agreed alternative, and the CEO would have signed the decision to proceed with it.

The amber critical item is key-account contact: 9 of the 10 named accounts have been called. The one remaining call is scheduled for Day 1 morning, with the account owner named.

What the operator learns: the register converts "are we ready?" into a count and a short list of decisions. The 11 critical items give the CEO a precise statement at the go review: nine green, one amber with a date, one red now fixed with evidence.

AI prompt assistance

AI is useful for building the register and drafting messages. It does not know your contracts or obligations, so every legal, employment, tax, and banking point needs your adviser's confirmation.

1. Draft a register from the deal documents.

I will paste a summary of the transaction (type, entities, locations, employee groups, systems, TSA scope, banking). Produce a Day 1 readiness register organized under five gates: people paid, cash flows, business operates, authority and access, trust protected. For each item give a test and the type of owner. Mark items that likely need legal, tax, or employment adviser confirmation.

Check: have each workstream owner add, remove, and confirm items; do not treat the list as complete.

2. Draft stakeholder Q&A.

Based on this description of the deal and what changes and does not change on Day 1, draft 15 questions that employees are likely to ask and a plain answer for each. Mark any answer that depends on a contract, policy, or law that I need to confirm.

Check: HR and counsel approve each answer before use; remove anything you cannot confirm.

3. Summarize the Day 1 exceptions.

Here is today's exceptions list with owner, age, and status. Write a half-page summary for the CEO: new exceptions, those closed, those at risk of becoming customer-facing, and decisions needed. Do not add information not in the list.

Check: reconcile counts to the exceptions list.

Implementation guide

Governance: the CEO owns the go or no-go decision, the integration lead owns the register and the command center, each gate has one accountable owner, and counsel and advisers sign off the legal, tax, employment, and banking mechanics. Keep the register alive after Day 1 as the first input to the 30-day plan.

Downloadable assets

The readiness register, the go or no-go record, and the command-center rhythm above are designed to be copied into a spreadsheet as they stand. Pair them with the synergy ledger described in Synergy Tracking: From Model to Realized EBITDA.

Related resources

• PMI Playbook: Day 1 to Day 365: the parent playbook.
• Integration Management Office (IMO) Setup: the team and cadence that run the command center.
• Transition Services Agreement (TSA) Management: services that must work on Day 1.
• 13-week cash flow forecast template: the liquidity view for the first weeks.
• Financial due diligence checklist: the diligence findings that feed this register.

Frequently asked questions

What is a Day 1 readiness checklist?

A Day 1 readiness checklist is a register of everything that must work on the first day of the combined business, with an owner, a test, and a status for each item. It focuses on payroll, cash, payments, operations, authority, and key relationships. Its purpose is a clear go or no-go decision before the announcement.

What should be on a Day 1 integration checklist?

Cover five gates: people are paid correctly, cash flows in and out through verified accounts, orders and service continue, authority and system access are clear, and key people, customers, and suppliers hear from the right person. Add legal, employment, tax, and banking confirmations from your counsel and advisers, since those depend on your agreements.

When should Day 1 planning start?

Start building the register about four weeks before close, or earlier where the deal timetable and confidentiality allow. Money-flow tests such as payroll runs and payment releases need two to three weeks to find and fix problems. Anything that depends on consent or notice from a third party should start as soon as the agreements allow.

Who decides whether Day 1 is a go or no-go?

The CEO, or another single named executive, decides, using a written list of mandatory items agreed in advance. Each mandatory item needs a test and a fallback. The decision is recorded with the status of every critical item and the fallback accepted for any item that is not green.

What commonly goes wrong on Day 1?

The most common failures are payroll errors, payments sent to wrong or unverified bank accounts, customers who do not know where to pay, unclear approval authority, and access gaps for finance and operations. Test money flows, verify bank details by call-back, write an interim authority matrix, and define a fallback for each mandatory item.

How this works in a System of Performance

A readiness register tells you what you checked before Day 1. The harder part is what happens afterward: which exceptions occurred, which were fixed, and what the fallback decisions cost. A Performis routine can take on a recurring job like this, with the scope and fit agreed with you: it works from the records your team supplies, prepares the work for your named reviewer, and keeps each approval on record. To see where your own numbers stand before the next close, bring it to us as a launch partner.