Business Purchase Analysis
Financial due diligence before you buy a business. We analyze seller financials, verify reported figures, identify red flags, and help you decide if the deal makes sense.
What You're Shown
The seller has prepared financials designed to make their business look attractive. Revenue is trending up. Margins are healthy. The adjusted EBITDA justifies the asking price. Everything has been selected and arranged to support a sale.
This isn’t necessarily dishonest. Business owners naturally present their operation in the best possible light. But the version of the business you see during negotiations may not reflect what you’re actually buying. Our job is to look past the presentation and verify what’s really there.
What We Examine
What We Examine
We review seller-provided financials, tax returns, bank statements, and supporting documentation. We compare reported revenue against deposits. We trace expenses to see what’s legitimate business cost versus personal spending run through the company. We look at how profit is actually generated and whether it’s sustainable.
What We Question
What We Question
Add-backs that inflate earnings. Customer concentration that creates risk. Revenue that depends on relationships the current owner will take with them. Equipment that’s aging out. Liabilities that aren’t obvious from the P&L. The things a seller might not mention unless you ask directly.
What Goes Wrong
Most buyers want the deal to work. You’ve spent months searching. You’ve found something that fits what you’re looking for. Walking away feels like starting over. This mindset creates a dangerous blind spot where you accept explanations that don’t quite add up because you want them to be true.
The problems don’t show up until after you’ve signed paperwork and wired money. Back taxes the seller didn’t mention. Accounts receivable that will never collect. A key customer who was already planning to leave. By then it’s too late. You own the problems now.
Information Asymmetry
Information Asymmetry
The seller knows everything about this business. You know only what they choose to show you. They’ve had years to understand the financials and decide how to present them. You have a few weeks to figure out if the story matches reality. Without independent analysis, you’re negotiating at a significant disadvantage.
Hidden Liabilities
Hidden Liabilities
Unpaid payroll taxes. Sales tax that was collected but never remitted. Unresolved customer disputes. Pending regulatory issues. These don’t always appear on financial statements. They surface later as demands for payment directed at the new owner. Sometimes the first you hear about them is a letter from a government agency.
What You Get
You make your decision based on verified numbers rather than seller claims. If the business is solid, you know exactly what you’re buying and can proceed with confidence. If there are problems, you find them before they become your problems. Either outcome is valuable.
When you negotiate, you’re not guessing. You know which add-backs are legitimate and which are aggressive. You know if reported revenue matches bank deposits. You have specific questions to ask about anything that doesn’t reconcile. This changes the dynamic completely.
Negotiate From Knowledge
Negotiate From Knowledge
Specific findings give you concrete points for price discussions. Showing the seller documented discrepancies is more effective than a general feeling that the price is too high. Sometimes the analysis reveals value the seller underestimated and confirms the opportunity is real. Either way, you negotiate from facts.
Buy or Walk Away
Buy or Walk Away
The analysis ends in one of two places. You move forward knowing the business is sound and the price is justified. Or you walk away knowing you avoided buying someone else’s problems. Both outcomes represent money well spent. The cost of due diligence is small compared to the cost of a bad acquisition.
LA's Small Business Bookkeeper
The Next Step:
A Short Conversation
Tell us about your business and what you're dealing with. We'll listen, ask a few questions, and give you a clear price for the work.