What is a Quality of Earnings (QoE) Report?

A Quality of Earnings (QoE) report is a comprehensive analysis that assesses the accuracy, sustainability, and drivers of a company’s earnings. These reports are essential for identifying risks and opportunities during the due diligence process, providing critical insights that go beyond what’s shown in standard financial statements.

Why Choose a Tailored QoE Report?

We offer a customized approach to Quality of Earnings reporting that prioritizes relevance, efficiency, and cost-effectiveness. By working closely with you, we can focus on the areas that matter most, ensuring that you receive the insights you need to make informed decisions. Our QoE reports and databooks contain the following elements: Business Overview, Transaction Overview, Financial Statements Summary, Adjustments, Proof of Cash, Proof of Sales, Trend Analysis, Working Capital Analysis, Fixed Asset Analysis, and Transaction Level Reconciliation/Analysis.

How We Deliver Fast, High-Quality Results

Our due diligence services offer a streamlined and cost-effective way to gain valuable insights into a company’s financial performance and evaluate its quality of earnings. Whether you are an investor, a buyer, or a seller, we are here to support you every step of the way, and deliver our QoE reports with very fast response times of 2-4 weeks, depending on the complexity of the operations, your requirements, and data availability.

Technology Due Diligence - Sapling Financial

Due Diligence – Technology Due Diligence

Our Technology Due Diligence Framework is an in-depth analysis of the state of a company from a technical perspective, including its products, technical infrastructure and architecture, product roadmap, services, practices, and IT staff.

Our Approach

Buyers and sellers should have knowledge about the technology used by the company in order to make sure that transactions will be smooth. For buyers, we will evaluate their potential purchases so they know how valuable the companies and the technologies they have are, and if the company itself can keep up with their promises. Meanwhile, for sellers, we will assist them in recognizing early problems and getting ready with all the important documents.

Our service for buyers includes Technology Assessment & Market Positioning, which involves the assessment of the technology portfolio and technological capability of the company against the industry trends and competitive environment. We will do the Technology Roadmap Alignment Evaluation in order to know if the technology roadmap is aligned with business strategy, market requirements, and pricing assumptions. In addition, our team will provide an Intellectual Property review regarding patents, trademark, and proprietary technologies to ensure that no issues related to infringement, litigation, and patent expiration come into play.

For sellers, we create Technology Documentation & Competitive Benchmarking documentation, which includes architecture, scalability, performance measures, and competitive benchmarking analysis. The Product & Technology Roadmap is drafted in detail, which consists of the existing products and the future technology strategy, considering growth opportunities for the business. The Infrastructure & Code Quality documentation is prepared, which comprises the software infrastructure and code quality standards. Additionally, we prepare the Team & Organizational Structure documentation that includes the organizational structure chart, key team members, and development costs – making your data room ready.

Who It’s For

Chief Financial Officer (CFO)
Entrepreneur / Business Owner / Chief Executive Officer (CEO)
Investment Banker (IB)
Private Equity Partner/Associate

What is Technology Due Diligence and why does it matter in M&A?

Technology Due Diligence is a detailed examination of a company’s technical condition – products, infrastructure, architecture, development, roadmaps, and the IT team behind it. Technology is one of the biggest drivers of value and risk in any M&A deal. Sapling provides a framework for Technology Due Diligence that enables both parties in an acquisition to clearly see and understand all the nuances involved before making a move.

What does a buy-side Technology Due Diligence engagement typically cover?

First, we typically perform a Technology Assessment & Market Positioning analysis in order to compare the target company’s offerings against market competitors. Second, we analyze Technical Team & Development Practices to determine who builds the product and how. Third, we assess Technology Roadmap Alignment to it is consistent with the company’s broader business strategy, growth plans, and pricing expectations. And lastly, we conduct an Intellectual Property Review to discover potential patent and trademark infringements.

How does sell-side Technology Due Diligence help a company prepare for a transaction?

Sell-Side Tech DD aims to anticipate potential buyer concerns. We work with the seller to provide them with documentation & competitive benchmarking related to technology, set out an appropriate Product & Technology Roadmap based on business growth strategies, outline the Infrastructure & Code Quality Standards so as to establish technical competence at the earliest. We review the company’s team and organizational structure, using available org charts and supporting information to understand key team members and reporting lines.

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