If you are currently under LOI, you are in the most dangerous phase of the acquisition. Do not sign the purchase agreement before reading this.

For buyers under LOI or in active diligence

The P&L
you were
shown is
not the
real one.

Most small business P&Ls are polished for sale. Add-backs are inflated. One-time expenses recur every year. Revenue spikes are manufactured. We find what brokers bury — before you sign the check.

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Available within 48 hours
$750 credited toward full diligence
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Target Acquisition — P&L Review 4 flags found
Line item
Stated
Verified
Status
Revenue
$1.84M
$1.79M
✓
FLAGOwner compensation
$85K
$142K
!
FLAG“Marketing” expenses
$64K
$21K actual
!
COGS
$420K
$418K
✓
FLAG“Consulting” fees
$48K
Related party
!
FLAGAdd-back: vehicle
$38K
Recurring
?
Rent & facilities
$96K
$96K
✓
Stated SDE
$487K
Verified SDE
$341K
Price impact
−$452K
73%
Of P&Ls we review contain at least one material misrepresentation
$147K
Average overstatement found in SDE claims we verify
48hrs
Time to schedule a diagnostic call from today
$750
Diagnostic call fee credited toward full QoE if you upgrade
Common findings

The 6 places sellers hide the truth

In thousands of P&L reviews, these are the six areas where small business sellers most consistently misrepresent earnings. Knowing where to look is 90% of the job.

01

Inflated add-backs

Every seller has “one-time” expenses that are actually recurring. Vehicle leases, family salaries, personal travel, and owner benefits all appear as legitimate add-backs on a polished P&L — and get removed from SDE to inflate the stated earnings.

Real example
“Marketing expense” of $64K included the owner’s personal LinkedIn subscription, a family vacation, and a golf club membership billed to the business. Legitimate marketing: $21K.
02

Below-market owner compensation

The owner shows themselves paying $60K/year to inflate SDE. A replacement manager would cost $95K–$120K. The add-back inflates the SDE number by tens of thousands — and the buyer pays a multiple on that phantom earnings figure.

Real example
Owner claimed $85K W-2 compensation. Market rate for their role: $142K. SDE was overstated by $57K — costing the buyer $182K at a 3.2x multiple.
03

Related-party transactions

The business pays “consulting fees” to the owner’s spouse, rents space from an LLC the owner controls at above-market rates, or purchases supplies from a related entity at inflated prices. These reduce real earnings but appear legitimate on the books.

Real example
$48K in annual “consulting fees” paid to an LLC owned by the seller’s brother-in-law. No documented services rendered. Removed from add-backs entirely after verification.
04

Revenue timing manipulation

Sellers accelerate revenue into the sale period — pulling forward invoices, billing early, and collecting deposits for work not yet performed. The TTM revenue looks strong. The 90 days after close tells a different story.

Real example
$220K in “annual contracts” billed in month 11 of the trailing 12. Prior year: $0 in the same period. Revenue was manufactured for the sale window.
05

Deferred expenses

Maintenance skipped for 18 months. Equipment replacements postponed. Staff raises delayed. Software subscriptions cancelled. The P&L looks lean and profitable. The new owner inherits a capital call in month two.

Real example
Fleet of 6 vehicles, all due for replacement within 18 months. Not disclosed in the LOI. Estimated replacement cost: $210K. Not reflected in purchase price negotiation.
06

Customer concentration risk

One customer represents 35% of revenue. The contract is month-to-month. The seller calls it “the anchor relationship.” The buyer calls it a single point of failure. It is rarely disclosed prominently — and the multiple should reflect it.

Real example
Top customer represented 41% of revenue on a verbal “handshake” agreement. Customer left 4 months post-close. Business revenue dropped 38% in year one under new ownership.
Services

Choose your level of protection

Four products. Each one designed for a specific stage of the acquisition process. Start where you are.

The $750 diagnostic call is credited in full toward any upgrade. The best entry point if you have a P&L and 48 hours.

1
Self-directed
The Due Diligence Bible
$27
Paperback  ·  $9.99 digital
The 220-page manual Heather uses to scrub books for private clients. Learn the 12 most common accounting tricks on Main Street — before you need them in a deal.
  • ✓
    12 add-back red flags identified
  • ✓
    Line-by-line P&L audit framework
  • ✓
    Phantom revenue detection
  • ✓
    Question scripts for seller interviews
Buy the book
2
Most requested
Red Flag Diagnostic Call
$750
Credited toward full QoE if you upgrade
Have a deal under LOI? Send the P&L 24 hours in advance. 60 minutes on Zoom scrubbing the numbers together. Heather shows you exactly where the seller is hiding the truth.
  • ✓
    P&L review before the call
  • ✓
    60-min live scrub session on Zoom
  • ✓
    Written summary of all red flags
  • ✓
    Negotiation questions to ask seller
  • ✓
    $750 credited toward QoE upgrade
Schedule now
Available within 48 hours
3
Lender-grade
Quality of Earnings Report
$4,500
Flat fee  ·  5–7 business days
Full financial verification by a credentialed analyst. The SDE is verified from source documents. Every add-back scrutinized. A lender-grade QoE summary you can take to your bank.
  • ✓
    Credentialed analyst review
  • ✓
    3-year P&L and tax return verification
  • ✓
    Add-back dispute analysis
  • ✓
    SDE normalization model
  • ✓
    Lender-grade earnings summary
  • ✓
    Written negotiation memo
  • ✓
    For businesses with less than $500K in Gross Annual Sales. Please contact us for a custom quote for larger businesses.
Request a QoE report
4
Complete protection
Full Diligence Bundle
$9,500
Flat fee  ·  7–10 business days
QoE report + key-man risk audit + legal document checklist + written deal recommendation memo. Everything you need to close with complete confidence on any deal over $750K.
  • ✓
    Full QoE report (everything above)
  • ✓
    Key-man dependency assessment
  • ✓
    Customer concentration analysis
  • ✓
    Legal document checklist review
  • ✓
    Written deal recommendation memo
  • ✓
    Post-close integration notes
Request a bundle
How it works

From booking to findings in 48–72 hours

01

Schedule and send the documents

Book your diagnostic call or order a QoE report. Send the P&L, balance sheet, and any available tax returns 24 hours before your scheduled session. We read everything before we speak.

Day 1
02

The scrub session or analyst review

For the diagnostic call: 60 minutes live on Zoom walking through every line item together. For the QoE: our credentialed analyst builds the verification model against source documents and 3 years of tax returns.

Days 1–2
03

You receive the findings and verified SDE

Written red flag summary, verified SDE calculation, and the specific negotiation questions or price adjustments the findings support. The diagnostic call delivers findings same-day. The QoE report delivers within 5–7 business days.

Days 2–7
04

You negotiate from evidence, not instinct

Every finding is documented with the source line, the stated amount, the verified amount, and the purchase price impact at your agreed multiple. You walk into renegotiation with specific numbers — not vague concerns.

Your call
Document checklist

Everything we verify in a full QoE review

Financial documents
  • 3 years of business tax returns (Form 1120S, Schedule C, or Form 1065)
  • 3 years of internal P&Ls reconciled against tax returns for each year
  • Trailing 12-month P&L with month-by-month revenue breakdown
  • Complete add-back schedule with documentation for every item over $2,500
  • 12 months of bank statements matching stated revenue figures
  • Accounts receivable aging confirming collectibility of outstanding balances
  • Payroll records confirming owner compensation and all family payroll
Operational & risk documents
  • Customer revenue report by customer for each of the last 3 years (concentration check)
  • Top 10 customers with contract status, tenure, and renewal risk assessment
  • Equipment list with age, condition, and last service date for all major assets
  • Any related-party transactions including family payroll, owner-controlled vendors, and rent
  • Vendor concentration review for single-source dependencies
  • Outstanding obligations not listed in liabilities (UCC search guidance provided)
  • Key-man dependency mapping for owner and any critical staff members
The add-back problem

Not all add-backs are created equal.

An add-back is a legitimate tool for normalizing owner-operated business earnings. The problem is that sellers — and their brokers — treat every possible expense as an add-back opportunity. The result is a stated SDE that bears little resemblance to the actual earnings.

We classify every add-back as verified, questionable, or false — with documentation. Then we rebuild the verified SDE from scratch and tell you exactly what the purchase price should be based on real earnings.

Owner salary below market rate
Owner pays themselves $60K. Market rate for their role: $95K. Legitimate add-back: $60K. Normalized deduction: $95K.
Adjustable
Non-recurring legal expense
One-time legal settlement in Year 2. Fully documented. Will not recur. Legitimate removal from SDE calculation.
Verified
“Marketing expense” — mixed personal use
$64K claimed. Includes golf club membership, family travel, personal subscriptions. Legitimate portion: $21K.
Disputed
Depreciation add-back
Equipment depreciation is a real non-cash expense. Standard addition back to SDE for capital-light businesses.
Verified
Annual vehicle lease (recurring)
Claimed as “one-time.” Seller has leased a vehicle every year for 7 years. Not a legitimate add-back.
Rejected
The cost of missing one add-back

“On a deal priced at 3x SDE, a $50K overstatement in the add-backs costs the buyer $150K at closing. That is not a rounding error. That is a year of earnings.”

$147K
Avg SDE overstatement found
3.2x
Avg multiple on our reviews
$470K
Average overpayment prevented per review
About Heather

I have looked at thousands of P&Ls. I know exactly where the bodies are buried.

Heather Griffith Barber has spent her career on both sides of the acquisition table. She built her first business from scratch at 23, co-founding Utah’s largest vehicle wrap company. She spent the next decade helping buyers avoid the mistakes that destroy acquisition returns — starting with the numbers on the page.

She is the author of The Due Diligence Bible, a 220-page framework for financial verification in small business acquisitions, and the creator of the Buy Scale Sell valuation platform.

Earnings Verified is the financial verification arm of the Buy Scale Sell network. Every QoE report and diligence bundle is contractor-fulfilled by credentialed financial analysts under Heather’s oversight.

900+
Buyers served in Buy Scale Sell network
$470K
Avg overpayment prevented
73%
Of P&Ls contain material issues
48hrs
Diagnostic call availability
Heather Griffith Barber speaking at a conference
Buyer results

What happened when they looked closer.

ETA Searcher — first acquisition

“The diagnostic call found $89K in questionable add-backs in 60 minutes. I went back to the seller with documented findings. We renegotiated $284K off the purchase price. The $750 call saved me more than I paid for the business.”

MK
Marcus K.
Denver, CO
$284K renegotiated before close
Rollup operator — third acquisition

“The QoE found $140K in SDE the broker had buried in management fees paid to a related entity. I thought I knew what I was buying. The report showed me I was $448K away from the real number.”

PK
Paul K.
Phoenix, AZ
$448K price correction identified
Private equity search fund

“We use Heather’s team on every deal under $3M. The turnaround is faster than any Big 4 alternative, the findings are more practical, and the $750 diagnostic call is the most efficient first pass available in the market.”

RL
Rachel L.
Chicago, IL
Ongoing partner — 12 deals reviewed

Need a valuation as well as verification?

Earnings Verified tells you whether the seller’s numbers are real. Buy Scale Sell tells you whether the price is right. Run both before you sign anything.

Get my valuation at Buy Scale Sell Back to services
Buy Scale Sell — Valuation Platform
Business valuation report
$1,499
One-time fee  ·  Instant access  ·  30-day guarantee
SDE multiple (your industry)Benchmarked
30M+ comparable transactions✓ Included
Growth opportunity analysis✓ Included
Exit readiness score✓ Included
Lender-ready summary✓ Included
Get my business valuation
Common questions

What buyers ask before they book.

When in the process should I get a diagnostic call or QoE report?
The diagnostic call is most valuable after you have a signed LOI but before you release any deposit or begin the final purchase agreement. The QoE report should be completed before you finalize purchase price and before your lender submits the loan application. Both should happen before you sign anything binding.
What is the difference between the diagnostic call and a QoE report?
The diagnostic call is a 60-minute live session with Heather where you scrub the P&L together and identify red flags. It is fast, practical, and designed to give you immediate findings you can use the same day. The QoE report is a full financial verification by a credentialed analyst — it takes 5–7 days and produces lender-grade documentation. The $750 call fee is credited toward the QoE if you upgrade.
What documents do I need to provide before the diagnostic call?
Send the P&L and balance sheet at least 24 hours before the call. Tax returns are helpful but not required for the diagnostic. If you have the seller’s add-back schedule, send that too. The more we can review in advance, the more specific the findings will be during the 60-minute session.
Can the findings be used to renegotiate the purchase price?
Yes — this is the primary use case. Every finding is documented with the source line item, the stated amount, the verified amount, and the price impact at your agreed multiple. Buyers routinely use our findings to renegotiate $50K–$500K+ off the purchase price or to add representations and warranties to the purchase agreement.
What if the findings are minor and the deal looks clean?
That is also a valuable outcome. A clean QoE report accelerates your lender’s approval process, reduces buyer anxiety at close, and gives you confidence that you are paying a fair price. In roughly 27% of reviews, we find no material issues. Those buyers close with complete confidence.
Can the QoE report be shared with an SBA lender?
Yes. The QoE report includes a lender-grade earnings summary specifically formatted for SBA financing conversations. Most SBA lenders welcome an independent QoE as part of the loan package — it reduces their underwriting risk and often accelerates approval. Some lenders require it for deals above $750K.
Last chance before you sign

The numbers you were shown are not the real numbers.

Schedule a diagnostic call this week. The $750 call fee is credited toward a full QoE if the findings warrant it. You have nothing to lose and potentially hundreds of thousands to save.

Schedule a diagnostic call — $750 View all services
✓
Available within 48 hours  ·  $750 credited toward QoE upgrade  ·  Powered by Buy Scale Sell