Quality of Earnings Reports – M&A Due Diligence 

Gain Confidence Before You Close

Whether you’re preparing to sell your business or looking to acquire one, a Quality of Earnings (QoE) report is essential to understanding the true financial performance and health of the company in question. At LGA, our QoE reports help you uncover red flags, validate earnings, and strengthen your negotiating position—so you can proceed with clarity and confidence.

What Is a Quality of Earnings Report?

A Quality of Earnings (QoE) report provides a detailed analysis of a company’s financial position, revenue, expenses, and net income, adjusted for accounting method, synergy, strategy, non-recurring, unusual, and discretionary items. Unlike an audit, which verifies financial statements for compliance, a QoE report focuses on the sustainability and accuracy of earnings while highlighting key indicators of risk and long-term value.

Our QoE services are designed to meet the needs of:

• Private equity firms evaluating a potential acquisition

• Strategic buyers entering a new market

• Business owners preparing for sale or seeking investment

• Lenders or investors seeking validation of financial performance

What’s Included in Our QoE Report?

• Adjusted EBITDA analysis
• Revenue and margin trends
• Customer and product concentration analysis
• Working capital analysis
• Accounting policies and unusual items
• Balance sheet and income statement normalization
• Tax considerations and potential exposures
• Risk and opportunity highlights

Start Smart. Finish Strong.

LGA’s Transaction Advisory team supports deals ranging from $5M to $100M+. Our senior professionals bring deep experience in M&A, audit, tax, and valuation, working with buyers, sellers, and investors across various industries.

Want to learn how a QoE report could benefit your transaction? Contact us today.