Why smart sellers run a sell-side Quality of Earnings report before buyers ever ask
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Deals rarely collapse because the idea is bad—they fall apart when the numbers can’t carry the story. We sat down with Patrick McMillan, a seasoned quality of earnings specialist with Ampleo, to show how sellers can turn diligence from a gauntlet into an advantage. From decoding what “quality” actually means in earnings to explaining why EBITDA is only a proxy for cash flow, we break down the practical steps that preserve price and speed to close.
We get specific about where value leaks: customer concentration, deferred revenue, under/over-billings in project work, and the accruals most teams skip—PTO and year-end bonuses. Patrick explains how a sell-side Quality of Earnings reframes the process: you uncover issues while you still control the fix, present a clean, defensible narrative, and walk buyers through a reconciled data room instead of apologizing under pressure. The result is fewer retrades, tighter timelines, and a higher “experience grade” from buyers who want to know they can work with your team after the ink dries.
If you’re preparing to sell, this conversation is your playbook for converting cash-basis chaos into accrual clarity, setting a realistic working capital peg, and translating adjustments into a story investment committees can approve. Whether you run SaaS, construction, or services, you’ll learn how to make your earnings more predictable, your cash flows more believable, and your valuation more durable.
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Bsalesgroup.com,
DesignMySale.com,
Chapters
1. Welcome & Guest Intro (00:00:00)
2. Patrick’s Path to Transaction Advisory (00:01:45)
3. What Quality of Earnings Really Means (00:06:10)
4. QofE vs. Audit: Key Differences (00:10:40)
5. Beyond EBITDA: Cash Flow & Working Capital (00:14:20)
6. Good QofE vs. Bad QofE (00:18:05)
7. Reports, Databooks, and Deliverables (00:22:05)
8. The Case for Sell-Side QofE (00:24:55)
9. Buyer Confidence, Retrades, and Deal Risk (00:29:40)
10. Organization, Team Grades, and Fit (00:33:20)
11. Cash-to-Accrual Pitfalls & Missed Accruals (00:37:20)
36 episodes