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QUALITY OF EARNINGS REPORTS

When looking to purchase a company, the obvious expectation is for future performance. Performing a quality of earnings assessment is an effective way for any buying entity looking to purchase a prospective company to gain an understanding of what types of cash flows can be predicted in the future. Our team at Kalex Valuations Inc. provides buyers with a fully-fleshed out picture of what that expectation can be for any prospective company by accurately providing a detailed analysis of all the components of a company's revenue and expenses including:

  • Determination of fixed vs. variable costs

  • Determination of one-time expenses vs. recurring expenses

  • Breakdown of revenue by appropriate components, such as customers and product/service lines

  • Analysis of assumptions used in cash flow projections and scenario analysis

  • Analysis of impact on both revenue and expenses due to management changes

  • Analysis of historic revenue trends

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