Quality of Earnings

We’re inspired to help you have all the information you need when buying or selling a business.

Understanding quality of earnings and due diligence is a key component of assessing value during a transaction.

Whether you’re on the sell-side or the buy-side of a transaction, quality of earnings and due diligence provide in-depth and diverse knowledge that will empower you to confidently move forward with a transaction.

Buy-Side Due Diligence

Whether you’re a strategic buyer, private equity group, family office, or lender, buy-side due diligence helps ensure all information associated with the deal (financial, operational, tax, IT, HR) is up to date. This provides you with an accurate picture of what you’re buying while identifying opportunities and threats and understanding value.

Sell-Side Quality of Earnings

Sell-side or buy-side quality of earnings (QofE) is a part of financial due diligence that involves the analysis of an organization’s financial information, including:

Normalized levels of EBITDA (earnings before interest, taxes, depreciation, and amortization) and the addbacks to bridge from reported EBITDA to adjusted EBITDA
Fluctuations in annual and monthly financial information
Revenue and gross margin by product, customer, or distribution segments
Operating expenses and employee analysis
Key balance sheet highlights
Normalized levels of working capital needed to operate the business

When you work with Eide Bailly, you'll work with accredited professionals, including Certified Merger and Acquisitions Advisors and Certified Public Accountants, who dedicate 100% of their time to due diligence and quality of earnings projects.

Understanding Due Diligence When Buying a Business

Before buying a business, it’s important to make sure the stories and accounting add up.

Read the Article

Step by Step Guide to Sell-Side Quality of Earnings

Discover the steps you’ll need to take when it comes to due diligence and quality of earnings.

Download the Guide

WHAT CLIENTS ARE SAYING

The Eide Bailly quality of earnings team was great to work with – the first engagement that we worked on together was very complex from an accounting perspective and we would not have been able to complete the sale of the business without their support.

Bharat Ramprasad

Stifel Nicolas & Company

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Wherever you are in your transaction journey – Eide Bailly can help.

Quality of earnings and due diligence are incredibly important next steps if you’re planning on selling or buying a business.

Quality of Earnings Leadership

Kyle OrwickCPA, CMAA

Partner – Transaction Advisory

Kyle helps clients makes sense of the numbers during a sales process or an acquisition. He helps them understand the risks and opportunities involved in the business being sold, and he provides insight into overcoming risks and taking advantage of the available opportunities.

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Matt LabernikCPA

Partner/ Transaction Advisory

Matt provides transaction advisory services to a variety of clients. He helps clients leverage their strengths and overcome obstacles by using his strong attention to detail to ensure all key risks and opportunities are identified.

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Frank DonatiCPA

Partner – Transaction Advisory

In 2015, Frank transitioned from the audit department to focus solely on transaction advisory services. He uses his experience in both transaction advisory and audit to tackle the challenges organizations face. Helping mid-size clients achieve their goals of buying or selling a business is what Frank believes to be the most rewarding aspect of his job.

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The key to a successful transaction can be summed up in one word: Information.

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