Our Work / Case Study

Quality of earnings for a US regional logistics group

Quality of Earnings

The Challenge

Payroll is the largest cost in a logistics business. Management had proposed several payroll addbacks that raised earnings. Without proof, a buyer could overpay or a lender could size debt on numbers that would not last.

What We Did

01Analysed earnings directly from the general ledger, account by account.
02Rebuilt a 48-month payroll schedule from four years of payroll registers.
03Matched payroll to the accounts to test every compensation addback.
04Kept only addbacks that the evidence supported.
05Ran a full quality check on the databook and logged each error found and fixed.

Value Delivered

Earnings rested on four years of payroll evidence, not on management's estimates.
Unsupported addbacks were challenged before they could raise the price.
The checked databook gave the deal team numbers they could defend in negotiation.

Our Work