A QoE is aimed at providing the buyers with an understanding of “How much money does the business sustainably earn”? A QoE analysis is a routine step in the due diligence process for private M&A situations, new investments, and follow-on financing deals. QoE typically focuses on identifying critical issues and potential adjustments to revenue and cost line items, thereby providing a solid basis for estimating sustainable earnings. This is crucial for the buyside as a target’s financial statements often possess some ‘noise’ which the QoE exercise attempts to eliminate to reflect true normalized performance.
Sapling’s Pre-QofE analysis provides GP’s with credible insights on the sustainability of current earnings and future prospects of portfolio companies, without the cost of a full QofE, allowing you to gradually grow your diligence investment during a period of economic uncertainty. You can read the full white paper here.
