In June 2025, the CFOx Transaction Services team supported a New York based private equity fund with a Buy-Side Quality of Earnings (QoE) for a merger; which would establish the group’s first platform investment.

CFOx conducted an in-depth review of the target’s historical financial performance to support the buyer’s view of operating results, identify transaction risks, and validate the overall earnings and Net Working capital profile. As part of the engagement, CFOx delivered robust Quality of Earnings, Net Working Capital, and Net Debt analyses to assist the buyer in understanding normalized financial metrics and balances to be included in the Purchase Agreement.

Alongside the Quality of Earnings, CFOx completed several supplemental analyses to provide additional confidence in the accuracy and completeness of the target’s financial information. These procedures included a Proof of Cash analysis, Payroll and Tax Reconciliations, and an evaluation of the company’s Accounts Receivable (AR) and Accounts Payable (AP) balances. Through the analysis of AR, a significant billing issue with the company’s largest customer was discovered, which led to a significant understatement of reported revenue, ultimately, further supporting the buyer’s thesis. All work was completed in accordance with GAAP and provided the client with a clear and reliable financial picture to support informed transaction decision-making.

Following close, the Transaction Services and our CFO and Accounting Services teams provided post-close integration, opening balance sheet, cash-to-accrual conversions, and implementation of a go-forward accounting system. By leveraging multiple service lines, the client benefitted from a coordinated handoff from diligence to ongoing operations, which provided enhanced financial visibility from day one.

If you would like to learn more about our Transaction Services, please reach out via email (info@cfoxadvisory.com) or schedule a call directly on our Contact Us page.

TS Services Provided:

• Quality of Earnings (QoE) Analysis
• Due Diligence on Target
• Net Working Capital Analysis
• Net Debt Analysis
• Proof of Cash Analysis
• Payroll and Tax Reconciliations
• AR/Revenue Recognition Analysis

CFO and Accounting Services Provided:

• Post-Close Integrations & Transitions
• Opening Balance Sheet
• Cash-to-Accrual Conversion
• Implementation of Go-Forward Accounting System & Processes
• Build out of Reporting Framework