By Ryan Murphy, Managing Director of Transaction Advisory Services
Many sellers hesitate to commission their own Quality of Earnings report, assuming it’s only for buyers. In reality, a sell-side QoE is one of the most strategic investments a company can make before taking its company to market.
What is a Sell-Side QoE?
A sell-side QoE provides the same in-depth analysis that buyers perform before they do. It highlights earnings strength, validates management’s claims, and most importantly, identifies potential issues in advance.
Why is it Worth the Cost?
Without a sell-side QoE, sellers risk losing leverage if buyers uncover surprises during diligence. By commissioning their own report, sellers:
- Control the narrative of financial performance.
- Reduce diligence delays and renegotiations.
- Build buyer confidence in reported earnings.
- Minimize the risk of price re-trading.
How Does it Improve Deal Outcomes?
A proactive approach allows management to correct or explain anomalies early, keeping deals on track and valuations strong. LCG’s transaction advisory team provides actionable insights that position companies to withstand buyer scrutiny and close faster.
Conclusion
A sell-side QoE isn’t an expense; it’s an investment in credibility and value. The transparency it provides can make the difference between a smooth closing and a stalled negotiation.
If you are interested in a Quality of Earnings report or have any questions regarding financial due diligence, contact Ryan Murphy at [email protected].