Quality of Earnings · Financial Due Diligence
Quality of Earnings Reports & Financial Due Diligence for Business Acquisitions
Thorough, pragmatic Buy-Side Due Diligence that helps you understand the financial story behind the numbers — before you close.
- 100+ Quality of Earnings & Financial Due Diligence projects
- Specialists in $1M–$15M business acquisitions
- Trusted by Search Funds, SBA buyers & Investors
- Typically 20–50% more affordable than large regional CPA firms
Preview of an Appletree Quality of Earnings Report
Quality of Earnings & Financial Due Diligence Projects
$1M-$15M
Typical Acquisition Size
More Affordable Than Large Regional CPA Firms
Real Acquisition Experience
Our Team of CPAs Have Personally Acquired Businesses
Why Appletree
Why Business Buyers Choose Appletree
100+ Quality of Earnings and Financial Due Diligence engagements - purpose-built for the lower middle market, not corporate M&A.
100+ QOE & Due Diligence Projects
Real pattern recognition built across more than 100 Quality of Earnings and Financial Due Diligence engagements.
$1M–$15M Acquisition Specialists
Focused on the lower middle market — SBA deals, search funds, and acquisition entrepreneurs at the size that matters to you.
Search Funds, SBA Buyers & Entrepreneurs
Acquisition buyers across the country rely on Appletree for independent Buy-Side Due Diligence.
Real Acquisition Experience
Our CPAs have personally bought businesses — we know what buyers actually need, not just what looks good on paper.
Thorough, Diligent & Pragmatic
Practical, buyer-focused findings — not dense technical reports that need a second interpreter.
20–50% More Affordable
QOE Analysis at a fee that fits real acquisition budgets — typically well below large regional CPA firms.
Traditional CPA Firms
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Generic, templated reports
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Built for large corporate transactions
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Higher fees, less accessible
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Limited real acquisition experience
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Technical reports that are hard to interpret
The Appletree Difference
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100+ Quality of Earnings & Financial Due Diligence engagements
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Designed for $1M–$15M business acquisitions
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CPAs who have personally acquired businesses
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Clear, actionable reports you can actually use
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Typically 20–50% more affordable than large regional firms
Education
What Is a Quality of Earnings Report?
A Quality of Earnings Report — also called a QOE Report or Financial Due Diligence Analysis — helps buyers understand whether a company's reported earnings reflect its true operating performance before completing an acquisition.
Ultimately, it answers one simple question: are the numbers real, and are they sustainable?
A thorough Quality of Earnings Analysis gives buyers, lenders, and investors the clarity to close with confidence — or walk away before a costly mistake.
Revenue Quality
Is revenue recurring, reliable, and accurately reported?
EBITDA Adjustments
Which add-backs and normalizations are legitimate?
Working Capital
What capital is actually needed to run the business?
Cash Flow
Is the business generating real, consistent free cash flow?
Customer & Vendor Risk
Concentration risk and single-customer dependency.
Financial Trends
Is the business growing, stable, or declining — and why?
Debt & Hidden Liabilities
Liabilities or obligations that should reduce the purchase price.
Sample Report
See Exactly What You'll Receive
Our Quality of Earnings Reports are built to be clear, actionable, and buyer-ready — not dense with accounting jargon. Every Quality of Earnings Report includes our proprietary Acquisition Scorecard: a plain-English summary of exactly what we found and what it means for your decision.
- Easy-to-read executive summary
- EBITDA bridge and adjustments
- Revenue and cash flow quality assessment
- Working capital and hidden liability analysis
- Proprietary Appletree Acquisition Scorecard
Who We Help
Is This Right for Your Acquisition?
Appletree's Quality of Earnings and Financial Due Diligence work is built for buyers across the lower middle market.
Search Funds
SBA Buyers
Acquisition Entrepreneurs
Private Equity
Independent Sponsors
Strategic Buyers
Business Buyers
Lenders & Investors
Appletree specializes in business acquisitions with purchase prices typically between $1M and $15M, the sweet spot for Search Funds, SBA Buyers, Acquisition Entrepreneurs, and Lower Middle Market Private Equity firms.
Our Process
Our Financial Due Diligence Process
A clear, defined process from first call to final report — you'll always know exactly where things stand.
Initial Consultation
We learn about your acquisition, deal timeline, and what you need from the engagement.
Document Request
We send a structured request list to gather the seller's financial records.
QOE Analysis
Our CPAs dig into revenue, EBITDA, working capital, cash flow, and risk factors.
Report & Scorecard
We deliver your QOE Report and the Appletree Acquisition Scorecard with clear findings.
Findings Review
We walk through the report, answer questions, and give practical recommendations.
Community Partners
Trusted by Business Buyers From
Many of our Quality of Earnings clients come from some of the most respected communities in small business M&A.
Industry Recognition
Featured On Leading M&A Podcasts
Our team has also been featured on respected podcasts focused on business acquisitions, search funds, and the lower middle market.
FAQ
Frequently Asked Questions
A Quality of Earnings Report (QOE Report) is a Financial Due Diligence analysis that examines whether a company's reported earnings accurately reflect its true operating performance. It reviews revenue quality, EBITDA adjustments, working capital, cash flow, and financial risks — helping buyers make informed acquisition decisions.
Financial Due Diligence is the process of independently verifying the financial health of a business before completing an acquisition. It typically includes a Quality of Earnings analysis, working capital review, cash flow assessment, and identification of risks or hidden liabilities.
Appletree's QOE Analysis includes revenue quality, EBITDA adjustments, working capital analysis, cash flow, customer and vendor concentration review, financial trend analysis, debt-like items, a management findings meeting, and our proprietary Acquisition Scorecard.
Typically once you have a signed Letter of Intent (LOI) and are in the due diligence phase. For SBA-financed deals, your lender will often require a formal Financial Due Diligence report before approving the loan.
Most Appletree QOE engagements are completed within 2–4 weeks, depending on business complexity and document availability. Contact us to discuss your specific timeline.
Yes. Buy-Side Due Diligence is our primary focus — we work on behalf of buyers to independently verify a target's financials before closing. We also provide Sell-Side Due Diligence (Sell-Side QOE) to help sellers prepare their financials for buyer scrutiny before going to market.
We specialize in lower middle market acquisitions, typically with a purchase price between $1M and $15M — the sweet spot for search funds, SBA buyers, acquisition entrepreneurs, and independent sponsors. We work with buyers nationwide.
Large CPA firms build QOE reports for corporate M&A — expensive, over-engineered, and built for bigger deals. Appletree specializes in $1M–$15M acquisitions, our CPAs have personally bought businesses, and we're typically 20–50% more affordable than large regional firms.
Ready to Move Forward With Confidence?
Whether you're evaluating your first acquisition or adding another business to your portfolio, our team is ready to help you understand the financial story behind the numbers — before you close.