Quality of Earnings Analysis

Experience Matters
When you need quality of earnings analysis, experience is crucial. As a specialized transaction advisory CPA firm, Midwest CPA excels in delivering thorough and insightful QoE reports. We go beyond standard evaluations to offer an independent perspective that uncovers critical financial details, potential risks, and opportunities for value enhancement in your transaction.
Over 50
Transactions
In the last 12-months alone
How We Help
Enterprise Value
Enterprise value is determined by taking a multiple of EBITDA or similar financial measure. We will analyze the financials to determine if that financial measure is accurately reported as well as any key factors that impact the multiple.
Net Debt
An assessment of debt-like items is done to highlight any potential reductions to enterprise value and future cash flows.
Net Working Capital
If less than a normal level of working capital is delivered at the closing of a transaction the buyer may be required to contribute additional capital in order to fund operations.
A comprehensive analysis of the business is needed to ensure adequate working capital is delivered at closing.
Our Clients Have Bought in a Variety of Industries
- HVAC
- Government Contracting
- Professional Services
- Retail
- Landscaping
- E-Commerce
- Healthcare
- Manufacturing
- Plumbing
- Trucking
- Restaurants
- Real Estate/Construction
- Marketing Agencies
- Electrical Contracting
Frequently Asked Questions
We recommend that our clients budget 4 weeks for the quality of earnings analysis in due diligence.
The project is often completed in 2-3 weeks as long as the seller provides data and answers questions within a reasonable timeframe.
A quality of earnings report can be a substantial investment.
That being said unless you can afford to easily lose the entire purchase price of the business you are buying it makes sense to protect yourself by having an expert analyze the financials.
Were happy to speak with you at any point in your search.
The best time to reach out is when you are getting close to submitting an LOI on a deal you are serious about.
An audit is different from a QoE in a variety of ways. For one an audit is a regulated procedure that has specific guidelines for how it needs to be completed. A QoE is a consulting engagement that can technically be done by anyone although they are typically done by CPAs.
An audit is much more balance sheet focused while a QoE is more focused on the income statement. The audit is looking to confirm that the financials comply with GAAP while a QoE helps a buyer understand the financial performance of the company that can be projected into the future as well as the key operating metrics.
On deals where audited financials are available the audit is complimentary to the QoE.
