RTO Due Diligence Check in Australia
RTO Due Diligence Check is a critical process when buying, selling, or acquiring a Registered Training Organisation (RTO) in Australia. It ensures compliance with ASQA (Australian Skills Quality Authority) regulations and identifies potential risks before finalizing a transaction.
Why is Due Diligence Important for RTOs?
Avoids legal & financial risks (e.g., non-compliance penalties, revoked registration).
Ensures business viability (checks financial health, student numbers, reputation).
Identifies hidden liabilities (outstanding audits, non-compliant training materials).
Confirms training scope validity (ensures courses are still accredited).
Key Areas Covered in an RTO Due Diligence Check
Compliance & Regulatory Review
✔ ASQA registration status (active, suspended, or under audit).
✔ Compliance with Standards for RTOs 2015 (Clauses 1-8).
✔ Past audit reports & rectifications (any unresolved non-compliances).
✔ AVETMISS & CRICOS reporting history (if applicable).
Financial & Operational Health
✔ Revenue streams & student enrolment trends.
✔ Outstanding debts or legal disputes.
✔ Marketing & recruitment practices (any unethical advertising risks?).
Data & Systems Review
✔ Student Management System (SMS) integrity.
✔ Records management compliance (are student files securely stored?).
✔ Cyber security measures (protection of sensitive data).
Training & Assessment Materials
✔ Validation records (are assessments up-to-date and compliant?).
✔ Trainer qualifications (do they hold TAE40122 or equivalent + industry experience?).
✔ Training & Assessment Strategies (TAS) for each qualification.
Student & Industry Reputation
✔ Completion & employment outcome rates.
✔ Student complaints & appeals history.
✔ Industry partnerships & relevance of courses.
Who Should Conduct RTO Due Diligence?
Buyers (to avoid purchasing a non-compliant RTO).
Sellers (to prepare for a smooth sale).
Investors & lenders (to assess financial risks).
RTO consultants or legal experts (for professional compliance checks).
Outcomes of Due Diligence
Proceed with purchase/sale (if all checks are satisfactory).
Negotiate terms (if minor issues need rectification).
Walk away (if major compliance/financial risks are found).
Due diligence checklist for a RTO in Australia
Here’s a comprehensive Due Diligence Checklist for acquiring or assessing a Registered Training Organisation (RTO) in Australia, tailored to meet the requirements of the Standards for RTOs 2025, ASQA, and the National Vocational Education and Training Regulator Act 2011.
Due Diligence Checklist for a Registered Training Organisation (RTO) – Australia
Corporate and Legal Documents
Company registration details (ASIC extract, ABN, ACN)
RTO registration certificate (from ASQA or state regulator)
Scope of registration (including current units/qualifications)
Ownership structure and shareholder agreements
Business name registration (if applicable)
Constitution or Trust Deed (if a trust/company)
Any ongoing legal proceedings or past compliance issues
Financial Records
Last 2–3 years of financial statements (P&L, balance sheet)
BAS and tax returns (ATO compliance)
Debtor and creditor lists
Outstanding debts or liabilities (e.g., leases, loans)
Evidence of student fee protection (e.g., TPS if applicable)
Payroll records and superannuation obligations
Trainer and Assessor Records
Trainer matrix and qualifications (TAE40116 or equivalent)
CVs and verified industry currency documents
Professional development and validation participation records
Employment or contractor agreements
Working With Children Checks (if applicable)
Student Records and Support
Records of current and past students (including completion, withdrawal)
Pre-enrolment materials and LLN tools
Fee schedule and refund policy
Student support policy and evidence of implementation
Complaints and appeals register
Contracts, Agreements and Licences
Lease agreements (if premises are included)
Third-party delivery agreements (if any)
Licensing agreements for training content (if from external sources)
Software licences (SMS, LMS, Microsoft, Google Workspace)
Supplier agreements
Risk Areas to Assess Closely
Any history of non-compliance or conditions on registration
Dependency on short-term funding or contracts
Trainer or staff availability risk
Gaps between TAS, delivery, and assessment practice
Alignment of resources with the most current training packages
ASQA and Compliance Records
Most recent ASQA audit report(s) and outcomes
Records of rectifications or sanctions (if any)
Evidence of compliance with the Standards for RTOs 2015
ASQA communications and correspondence
CRICOS registration (if delivering to international students)
Training and Assessment Materials
Full set of training and assessment strategies (TAS) for each qualification/unit
Learner resources (all qualifications on scope)
Assessment tools aligned with competency requirements
Mapping documents (training package to assessment)
RPL kits and assessment validation records
First Aid and White Card training kits (if on scope)
Student Management System (SMS) & LMS
Access to current SMS (e.g., aXcelerate, VETtrak, Wisenet)
LMS (Moodle, Canvas, etc.) login and content structure
Student enrolment and progression records
USI verification records
AVETMISS-compliant reporting system
Certification issuance logs
Policies and Procedures
Policy and procedure manual (compliance with Standards for RTOs)
Internal audit reports and corrective action records
Continuous Improvement Register and Schedule
Risk management plan
Marketing and advertising materials (must meet Clause 4.1 of Standards)
Digital Assets and Branding
Website ownership and hosting login
Domain names and email hosting records
Social media account access (LinkedIn, Facebook, etc.)
Logo, branding files, and design assets
Google Workspace or Microsoft 365 admin access
Optional: CRICOS or Funded Training Checks
If applicable:
CRICOS approval and related policies (for international training)
State funding contracts (Skills Tasmania, Smart & Skilled, etc.)
Evidence of compliance with funding guidelines