Quality of Earnings
& underwriting
A stated EBITDA figure is an argument, not a fact. My job is to test it — and to tell you what the business actually earns before the price is fixed.
Not an audit. A different question.
An audit asks whether the financial statements comply with the accounting standards. A Quality of Earnings analysis asks something narrower and far more useful to a buyer: how much of the reported profit is real, repeatable, and still going to be there after closing.
That means going behind the add-backs. Owner compensation, one-time revenue, related-party arrangements, deferred maintenance, capitalized costs that should have hit the income statement — each one either survives evidence or comes out of the number.
What you receive
Deliverables- Normalized EBITDA with every adjustment itemized and sourced
- Add-back schedule showing what survived testing and what did not
- Working capital analysis and a peg recommendation
- Proof of cash and revenue reconciliation to bank
- Customer and supplier concentration
- Margin walk by period and by line
- Quality of revenue: recurring versus one-time
- A findings memo written for a decision, not a file
Underwriting engagements follow the same discipline applied to credit: capacity, collateral, structure, and the scenarios where the loan stops performing.
How it runs
Four steps- Step 01
Scoping call
What the deal is, what is at stake, and what records exist. If I am not the right person for it, you will hear that on this call.
30 minutes · no charge - Step 02
Document request
A specific list, not a fishing expedition: statements, general ledger, bank reconciliations, tax filings, payroll, material contracts.
Fixed quote · retainer - Step 03
Analysis
Normalize the statements, test every add-back against evidence, prove out cash, and work through working capital, margin, and concentration.
Two to four weeks - Step 04
Report and debrief
Written findings with adjustments laid out line by line, then a call to walk through where the number moves and what it gives you to negotiate.
Report plus one hour
Fees
All amounts CADQuality of Earnings
Full diligence engagement including the report, the adjustment schedules, and the debrief call. Priced on deal size, entities and periods in scope, and the state of the records.
Underwriting review
Credit and mortgage underwriting, risk assessment, and scenario modelling on a single facility or a portfolio.
Consulting
Strategy, capital allocation, operations, and go-to-market advisory where you need a second set of eyes on a decision rather than a full report.
You get a fixed quote after the scoping call, before any work begins. Compressed timelines are possible and are priced accordingly.
Questions
Before you callHow long does it take?
Two to four weeks from the day the document request is filled. The clock is usually set by how fast the target produces records, not by the analysis itself.
Can you work from incomplete books?
Often, yes — reconstructed statements are common in owner-operated businesses. It takes longer and it costs more, and I will tell you at the scoping call whether the records can support a defensible number at all.
Do you work sell-side?
Yes. A sell-side QoE run before you go to market finds the adjustments a buyer would have used against you, which is generally cheaper than finding them during the buyer's diligence.
Do you work outside Ontario?
Financial analysis, underwriting, and consulting are handled remotely anywhere in Canada and the United States. Paralegal representation is limited to Ontario.
Test the number before you pay for it.
Thirty minutes on the phone will tell us both whether this engagement is worth running.