What a QoE tests
| Area | Typical finding that cuts price |
|---|---|
| Add-backs | Undocumented owner perks or "one-time" costs that recur |
| Revenue | Cash vs accrual timing, deposits recognized too early |
| Margins | Job costing that hides unprofitable work |
| Working capital | A normal level higher than the buyer assumed |
| Payroll | Owner or family pay below market; misclassified contractors |
| Customer concentration | Top customers larger than presented |
- Sourced value range for your trade and state
- The buyer types most likely to call you
- 3 fixes that move your multiple + a PE-offer checklist
After purchase we email you a short questionnaire, then your brief as a PDF. 14-day money-back guarantee. TradeExit Guide is not a business broker or appraiser. Refund policy
QoE vs audit vs review
An audit gives an opinion on whether financial statements follow accounting standards. A QoE is a diligence report on sustainable earnings - it is what the price is built on. Many Main Street deals never have either; lenders rely on tax returns. Deals with PE buyers or larger strategic acquirers usually include a buyer-side QoE.
Should you get a sell-side QoE?
Worth considering once EBITDA is roughly $1M+ and you expect PE interest: it finds problems while you can still fix or explain them, supports your add-backs, and makes buyers’ diligence faster. Start by recasting honestly with the SDE calculator.
Know your number first
Sourced range for your trade in 60 seconds, no email needed.
- Sourced value range for your trade and state
- The buyer types most likely to call you
- 3 fixes that move your multiple + a PE-offer checklist
After purchase we email you a short questionnaire, then your brief as a PDF. 14-day money-back guarantee. TradeExit Guide is not a business broker or appraiser. Refund policy
Frequently asked questions
What is a quality of earnings report?
An accounting analysis of whether a company’s adjusted earnings are accurate, sustainable and properly adjusted, used to support the purchase price.
Who pays for the QoE?
The buyer pays for its own; a seller pays for a sell-side QoE.
Is a QoE the same as an audit?
No. An audit opines on GAAP compliance; a QoE analyzes earnings quality for deal pricing.
Sources
- IBBA / M&A Source / Pepperdine Market Pulse, Q2 2026 highlights (accessed 2026-09-23)