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Legal Audits
A structured legal health check for your business: we examine the company's filings, contracts, employment, licences, and IP, and hand you a red-flag report with a remediation plan. You learn what a buyer's or investor's lawyers would find — before they find it.
Every company carries a gap between the business it runs and the business its paperwork describes. Shares were transferred but the register was never written up; the biggest customer is served on an agreement that expired two years ago; the licence covers the old warehouse, not the new one. None of these problems announces itself. They surface at the worst possible moments — in an investor's due diligence, a regulator's notice, or a dispute — when the cost of the gap is set by someone else.
A legal audit closes that gap on your terms. It is a defined diagnostic exercise: we agree the scope, collect the documents, review them against the law that actually applies to your business, and report what we find in a red-flag report written in plain language. The report rates every finding by severity and states its consequence honestly — including, where it is true, that a finding is minor and can wait. We would rather tell you that eleven of fifteen findings are routine than inflate a report to justify the exercise.
The review runs across the areas where problems concentrate: corporate records and SECP filings under the Companies Act, 2017; contracts with the customers and suppliers the business depends on; employment files against the applicable provincial regime; licences and registrations against actual operations; and ownership of the intangibles — brand, code, content, domains — that increasingly carry the company's value. Where your business needs a deeper cut, such as data protection or sector licensing, the scoping memo says so and prices it visibly.
The audit ends with a remediation plan, because a diagnosis without treatment is a shelf document. The plan sequences the fixes, names an owner for each, and separates what we should do from what your own team can do cheaply. Clients who run the audit before a transaction consistently negotiate from a stronger position: the disclosure letter is shorter, the warranty negotiation calmer, and the other side's lawyers find what you already fixed. As of July 2026, this page describes the audit framework generally; client-specific instruments are confirmed at scoping.
What You Get
The deliverables, stated up front.
- A scoping memo fixing exactly which areas the audit covers, so you are buying a defined exercise, not an open meter.
- A document request list your team can actually answer — organised by area, with a named owner for each item.
- A corporate records review: SECP filings, statutory registers, share capital history, and whether the paper company matches the real one.
- A contracts review of your key customer, supplier, and financing agreements — signed, unsigned, expired, and missing.
- An employment and HR check: contracts, policies, social security and EOBI registrations, and termination exposure.
- A licensing and registrations check against the activities the business actually carries on, federal and provincial.
- The red-flag report: every finding rated red, amber, or green, in plain language, with the consequence of each stated honestly.
- A remediation plan — sequenced, owner-assigned, and priced separately — so the report becomes a to-do list rather than a shelf document.
How It Works
The process, stage by stage.
1
Scoping
We agree the audit's boundaries in writing: which entities, which areas, which period. A ten-person startup preparing to raise needs a different exercise from a two-hundred-person distributor preparing to sell. Scope drives the fee, and both are fixed before we begin.
2
Document collection
You receive the request list; we track what arrives and what does not. Gaps are findings in themselves — a company that cannot locate its share transfer instruments has told us something a complete file never could.
3
Review
We work through the records area by area against the applicable law: the Companies Act, 2017 for corporate housekeeping, tax registrations against filing history, employment files against the applicable provincial labour regime, licences against actual operations, and IP ownership against who actually created the assets.
4
Red-flag report
Findings are written for the person who has to act on them, not for other lawyers. Each item states what we found, why it matters, what it could cost if left alone, and what fixing it involves. Red means act now; amber means fix this quarter; green means noted and fine.
5
Remediation
We walk the report with you, agree priorities, and quote the fix-up work — overdue filings, missing contracts, register reconstruction, licence applications — as a separate, defined engagement. You choose what we fix and what your team fixes.
The Legal Framework
The law this work runs on.
- Companies Act, 2017
- The benchmark for the corporate portion of the audit: statutory registers, annual and event-based SECP filings, share issuance and transfer formalities, and directors' and officers' obligations.
- Income Tax Ordinance, 2001 and Sales Tax Act, 1990
- We check that the company holds the registrations its activity requires and that its filing status is current. We flag tax exposures for your tax adviser; a legal audit identifies the gap, it does not re-perform the returns.
- Provincial labour and establishment laws
- For a Lahore-based business, the Punjab labour regime — including shops and establishments registration, social security, and EOBI — sets the employment compliance baseline [SPECIFIC APPLICABLE INSTRUMENTS PER CLIENT — TO BE CONFIRMED AT SCOPING].
- Sector-specific licensing regimes
- Depending on the business: PTA, SBP, SECP licensing, DRAP, PSQCA, provincial food authorities, and others. The scoping memo names the regulators relevant to you, not a generic list.
Statutory references are stated as of the page’s as-of date and flagged where verification is pending; the law moves, and the current position should be confirmed before relying on it.
Common Mistakes
The errors we see most — and their price.
- Waiting for a due diligence request to discover that three years of SECP filings are missing — and negotiating a valuation with that discovery on the table.
- Assuming the accountant's tax filings mean the company is compliant, when licences, registers, and contracts are nobody's job.
- Holding key commercial relationships on expired agreements, or on no agreement at all.
- Employing half the team on offer letters that were never followed by contracts, in a province whose labour law does not care what the offer letter says.
- Owning nothing: the brand registered to a founder, the code written by unassigned contractors, the domain in an ex-employee's account.
- Treating the audit report as the deliverable and never starting the remediation, so the same red flags reappear a year later with interest.
- Auditing only the flagship entity and ignoring the dormant subsidiary that still has directors, liabilities, and filing obligations.
Questions, Answered
What clients ask about legal audits.
Three moments recur: before a fundraise or sale, when the other side's lawyers will run this exact exercise against you; after a period of fast growth, when operations have outrun paperwork; and on a change of ownership or management, when the incoming team wants a baseline. If none of those apply, an audit every two to three years keeps the file honest.
A financial audit tests whether the accounts fairly present the numbers. A legal audit tests whether the company's legal position matches its assumptions — that it owns what it thinks it owns, has filed what it must file, and holds the licences its operations require. The two overlap at points such as tax registrations, and we coordinate with your auditors where useful.
The main demand on your side is document collection, which the request list organises into a defined task. Interviews are short and few. Most audits run without the wider team knowing one is underway, which matters when the audit is preparation for a confidential transaction.
No. The audit is a privileged, confidential exercise conducted by your lawyers for you. Its purpose is to let you fix problems on your own timetable rather than a regulator's or a counterparty's. Where a finding involves a continuing legal obligation, we advise you on it — the decision and the timing remain yours.
It depends on scope and on how quickly documents arrive; the scoping memo commits to a timetable for our side of the work. A focused audit of a single small company is measured in weeks, not months.
The audit is quoted as a fixed fee by engagement letter, set at scoping. Remediation work is quoted separately once the report defines it. [FEE STRUCTURE — TO BE CONFIRMED BY THE FIRM]
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Prepared by The First Counsel · As of 2026-07-12 · Pending professional review — statements flagged in the text are being verified
This publication is provided for general information only. It is not legal advice, and neither reading it nor corresponding with the firm about it creates a lawyer–client relationship. The position stated must be verified against current law before it is relied upon.