Buyer Due Diligence
Review the business model, operating model, customer concentration, owner dependency, revenue quality, contracts, lease risk, staff, tax filings, and hidden liabilities before conditions are waived.
Acquisition & exit advisory
Before you buy, sell, waive conditions, or negotiate price, understand what the numbers are really saying.
Support for business buyers, sellers, searchers, and owner-operators who need valuation, financing, normalized earnings, working capital, tax structure, and transaction risk translated into plain decisions.
The transaction decision journey
A good deal process does not start with the multiple. It starts with what is being bought or sold, whether the earnings are real, and what risks transfer at closing.
01Understand the business
02Normalize earnings
03Review working capital
04Structure tax and deal terms
05Finance or prepare for sale
06Negotiate and close
Quality of Earnings
Normalize EBITDA or SDE by adjusting owner compensation, personal expenses, non-recurring items, related-party transactions, accounting timing issues, and market-rate replacement costs.
Working Capital Peg
Calculate normal working capital, test AR collectability, inventory quality, AP pressure, accrued liabilities, seasonality, and the closing adjustment that often becomes a deal dispute.
Acquisition Financing
Build the lender case, sources and uses, debt capacity, DSCR, collateral view, covenant sensitivity, seller financing, earn-out logic, and 100-day cash plan.
Tax and Deal Structure
Compare asset sale versus share sale, inherited liabilities, GST/HST, CCA, purchase price allocation, LCGE implications, holdbacks, indemnities, and after-tax proceeds.
Sellability Preparation
Clean up financial reporting, support add-backs, document recurring revenue, reduce owner dependency, prepare management explanations, and build buyer trust before going to market.
Normalized earnings are where many deals change.
The seller's reported profit is rarely the exact number a buyer should capitalize. The work is to bridge accounting income to sustainable earning power that can survive buyer, lender, and tax scrutiny.
Start with reported results
Use tax returns, financial statements, management accounts, bank statements, and the general ledger to reconcile what was reported to what actually happened.
Adjust for reality
Normalize owner salary, unpaid family labour, personal expenses, one-time revenue, one-time costs, non-market rent, non-core income, and accounting anomalies.
Price the right number
Enterprise value should reflect normalized EBITDA or SDE, net debt, cash, working capital, required replacement management, and the risk of the forecast.
For buyers, the risk is not only overpaying. It is inheriting a business that changes after closing.
The first question is not whether the business looked busy during a visit. It is whether the customers, staff, lease, systems, margins, and cash flow continue when the current owner leaves.
- Test owner dependency, key customer concentration, contract durability, and whether revenue transfers with the business.
- Review balance sheet risks such as old receivables, obsolete inventory, director loans, overdue payables, and unaccrued employee liabilities.
- Confirm CRA filings, payroll remittances, GST/HST exposure, and whether an asset or share purchase changes the risk profile.
Buyer red-flag review
Before you waive conditions, review where the deal could break: earnings quality, working capital, owner dependency, lease renewal, tax exposure, staff retention, and financing capacity.
For sellers, value is protected before the buyer asks the hard questions.
Buyers may not dislike the business. They may simply not trust the numbers. Exit preparation reduces that discount by making the financial story easier to verify.
- Prepare a clean bridge from reported income to normalized EBITDA or SDE, with support for every add-back.
- Resolve messy related-party balances, owner expenses, undocumented compensation, weak monthly reporting, and missing schedules.
- Show revenue quality, margin trends, customer concentration, working capital needs, tax structure, and the transition plan clearly.
Exit readiness lens
The strongest sale process makes the buyer's diligence easier, not harder. Clean numbers, defensible adjustments, and a credible transition plan can protect both price and certainty of close.
Request an acquisition or exit review.
Use a focused review before signing an LOI, waiving diligence, approaching lenders, or taking the business to market.
Transaction Decision Review
A practical review of normalized earnings, working capital, financing, tax structure, deal risks, and the questions that should be answered before the next step.
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