Quality of earnings for investors and acquirers

The scope your committee expects. The speed it does not.

Credex Advisors is a licensed CPA firm that performs buy side and sell side quality of earnings for private equity, family offices, independent sponsors, and corporate development teams. Every engagement includes a full transaction level cash proof, normalized EBITDA with each adjustment supported, revenue and margin analysis, and a net working capital analysis, delivered in about ten business days from complete data at a fixed fee scoped to the transaction.

How Credex compares to a national firm QoE.

National or Big Four transaction services
Credex Advisors
Scope
Full QoE, NWC, quality of revenue, databook
The same scope; an appendix maps every procedure to the report
Cash proof
Sampled, or performed only on request at additional cost
Full transaction level cash proof on every engagement
Who does the work
Associates and seniors; manager and partner review at the end
CPAs on every engagement; the partner who scopes it reviews it
Timeline
Three to six weeks from data room access
About ten business days from complete data
Fee basis
Hourly with an estimate, or a fee that moves with hours
Fixed fee scoped in one call; it does not change unless the scope does
Fit
Optimized for $50M+ enterprise value
Optimized for $5M to $100M enterprise value, including add ons and carve outs

What is in a Credex QoE.

Quality of earnings

Reported to adjusted EBITDA bridge for the two most recent fiscal years and the trailing twelve months, with management, diligence, and pro forma adjustments each supported by source documents.

Cash proof

Revenue and expenses reconciled to bank receipts and disbursements for every period under review, not sampled. Unreported deposits, personal spending, and non operating flows carried to the adjustment schedule.

Quality of revenue

Customer and product level revenue, concentration, retention, pricing and volume, gross margin by line, and contract terms, with a view on run rate.

Net working capital

Monthly NWC for the trailing twelve months, seasonality, a proposed peg and mechanism, and debt like and cash like items for the purchase agreement.

Balance sheet and other

Proof of key balances, capitalization and capex, related party transactions, accrual and cut off testing, and accounting policies and their effect on earnings.

Deliverables

The report, a full Excel databook with the transaction level cash proof, a key findings summary for the committee memo, and direct access to the CPA engagement partner through closing.

Pricing is scoped, and fixed.

A full quality of earnings is scoped to the transaction: the number of entities and books, revenue streams and customer data availability, the period under review, whether a sell side report exists, and the depth of quality of revenue and working capital work the committee needs. Credex scopes in a single call and issues a fixed fee proposal the same day. The fee is fixed for the agreed scope and does not move with hours.

Questions investors and corporate acquirers ask.

Will an investment committee or a lender accept a Credex quality of earnings?

Yes. Credex Advisors is a licensed CPA firm, the scope matches what national firms deliver, every adjustment is supported in the databook, and the cash proof is more complete than most national firm reports because it is performed in full rather than sampled. Lenders rely on Credex reports, and Credex is a lender engaged QoE provider under the SBA program.

How does Credex deliver in ten business days?

The slow part of any QoE is extracting, classifying, and matching transactions from bank data and ledgers. Credex performs that on the Credex diligence platform rather than by hand, so CPAs spend their time on adjustments, revenue quality, and conclusions.

Why is the fee lower than a national firm, and what is the catch?

The fee is lower because fewer hours are spent on mechanical work, not because the scope is smaller. The catch is that Credex is built for transactions from roughly $5M to $100M in enterprise value with one to a handful of entities; very large multinational carve outs are still national firm territory.

Do you do sell side quality of earnings?

Yes. A sell side QoE from Credex gives a seller a defended adjusted EBITDA, a clean cash proof, and a databook a buyer's diligence team can tie to, which shortens buy side diligence and reduces retrades.

What does the cash proof add if the target has audited financials?

An audit opines on financial statements at year end. It does not test whether the earnings a buyer is paying for are supported by cash across the trailing twelve months, and it does not identify owner spending, related party flows, or timing that inflates EBITDA.

Can Credex work alongside our existing diligence providers?

Yes. Credex regularly performs the financial QoE while counsel, tax, and commercial diligence run in parallel, and coordinates with the lender's requirements. Credex can also perform only the cash proof or the NWC analysis where another firm holds the broader scope.

Who leads the engagement?

A CPA engagement partner with national firm transaction advisory experience scopes, leads, and signs off, and is your contact through closing. The analysts performing the procedures are CPAs.

Send us the deal overview. We will scope it the same day.

A 30 minute call, a fixed fee proposal, and a request list to management within one business day of engagement.