Data Room

Business, Legal & Accounting Glossary

Definition: Data Room

Data Room

Full Definition of Data Room

A data room is a safe facility created by a seller in which confidential data from a company is placed for viewing by the purchaser. The data room is an essential component of the due diligence process, which begins when a non-disclosure agreement is signed.

A due diligence data room is another name for a data room.

Most purchasers want to perform a thorough examination of every area of a company before purchasing it. To facilitate this, the seller will frequently store critical data and information in a physically safe and constantly monitored area that a team of experts from the buying firm may access. This helps the buyer to check the value of the company and unearth any skeletons (if any) that could jeopardize his investment.

Because the records stored in a data room are extremely secret, it takes a significant amount of time and effort to build a strong and secure data room (i.e. copies of financial, legal, and business documents). The data room can be constructed virtually to save both the seller’s (in terms of building a data room) and the buyer’s (in terms of the time and cost associated with employing specialist analysts). Because access to data rooms is limited, the buying team is normally forced to see them one at a time, according to a predetermined timetable.

Synonyms For Data Room

Due Diligence Data Room

Related Phrases

Virtual Data Room
Due Diligence
Non-Disclosure Agreement
Definitive Purchase Agreement

Cite Term

To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
Modern Language Association (MLA):
Data Room. Payroll & Accounting Heaven Ltd.
May 06, 2022
Chicago Manual of Style (CMS):
Data Room. Payroll & Accounting Heaven Ltd. (accessed: May 06, 2022).
American Psychological Association (APA):
Data Room. Retrieved May 06, 2022
, from website:

Definition Sources

Definitions for Data Room are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 27th January, 2022 | 1 Views.