Quality of Earnings

Uncover the true financial story: Your deal clarity starts here.

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Uncover the true financial story behind the numbers 

Financial statements tell only part of the story. Compressed deal timelines mean buyers and sellers need deeper insights into earnings sustainability, cash flow predictability, and the real drivers of business performance. At BPM, we deliver comprehensive Quality of Earnings reports that cut through accounting complexity to reveal the financial reality of your transaction. 

Our approach to Quality of Earnings 

We take a forensic, business-focused approach that goes beyond traditional financial analysis. Our QoE studies help you understand not just what the numbers say, but what they mean for future performance and deal value. 

Earnings sustainability analysis: Our experienced team conducts thorough reviews of revenue recognition, expense patterns, and one-time items to determine which earnings are likely to continue post-transaction. We identify and quantify adjustments that impact normalized earnings and cash flow. 

Working capital deep dive: We analyze working capital trends, seasonal patterns, and management practices to provide accurate assessments of cash requirements and potential post-closing adjustments that affect deal economics. 

Cash flow reality check: Moving beyond reported earnings, we examine the relationship between income and cash generation, identifying discrepancies that could signal operational issues or accounting irregularities. 

Related Insights

Comprehensive Quality of Earnings services 

Quality of Earnings Services

Buy-Side Quality of Earnings

Our independent analysis validates seller representations and identifies risks and opportunities that impact your investment decision, giving you confidence in the deal’s financial foundation.

Sell-Side Preparation

We help you prepare for buyer scrutiny by conducting preliminary QoE analysis, identifying potential issues, and positioning your financial story for maximum credibility and value.

Working Capital Analysis

Our detailed assessment of working capital trends and requirements provides clarity on cash needs and helps establish appropriate closing mechanisms and post-closing adjustments.

Earnings Sustainability Assessment

We evaluate the quality and predictability of earnings streams, helping you understand which revenue sources and cost structures will continue after the transaction closes.

Building deal confidence 

Your transaction timeline is tight while the stakes are high. Our approach includes: 

  • Rapid deployment of experienced QoE professionals who understand deal dynamics 
  • Clear communication of findings that translate complex analysis into actionable insights 
  • Proactive identification of issues that could impact valuation or deal structure 

The BPM difference: Beyond standard QoE reports 

When you work with BPM, you gain a partner committed to your deal success: 

  • Experienced transaction professionals with deep industry knowledge 
  • Proactive identification of value drivers and potential red flags
  • Strategic perspective that aligns financial analysis with your investment thesis  
  • Clear, actionable reporting that supports informed decision-making 
  • Flexible engagement approach that adapts to deal size and complexity 
  • Collaborative process that enhances your existing due diligence efforts 

By partnering with BPM, you’re gaining the financial clarity needed to make confident transaction decisions. Together, we’ll uncover the true story behind the numbers and position you for deal success. 

Meet our Quality of Earnings Leader

Craig Hamm

Craig Hamm

Partner, Advisory
BPM Board of Directors

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Looking for a team who understands where you’re headed and how to help you get there? Whether you’re building something new, managing growth or preserving success, let’s talk.