In private equity transactions, Baker Tilly’s CFO advisory services shine behind the scenes

Pre-transaction, the first stage of the private equity transaction life cycle, includes some of the most critical steps in helping to ensure the short-term health and long-term viability of a deal. A quality of earnings (QoE) report, for instance, is a critical component to the financial due diligence process. In many ways, a QoE report sets the tone for the entire transaction, so all involved parties are typically quite invested in the timeliness and accuracy of the QoE report.

That said, preparing a QoE report can be a challenging part of the process, particularly when a company does not have its books and records in order. Inaccurate financial information can cause significant delays in the QoE report and, therefore, the transaction. Additionally, it can result in a lower valuation of the company due to concerns about the overall business due to the lack of clean financial information.

It’s not necessarily a matter of sloppy bookkeeping either. Some companies may not possess the resources to maintain books and records to the extent needed for a major transaction. Also, typically a company’s finance team must devote its day-to-day attention to other vital areas. In either case, Baker Tilly is prepared to assist.