A quality of earnings report is the written deliverable of a QoE analysis. It presents adjusted EBITDA, the bridge from reported to adjusted earnings, and the evidence supporting material adjustments so a reviewer can evaluate the analysis rather than take it on faith.
20–60 pp
Typical report length
3 yrs + TTM
Periods presented
$1,000
Shepi per-project pricing
What a QoE Report Is (and Isn't)
The report is an evidence package, not an opinion letter. It does not attest to the financial statements and it does not carry an audit or review opinion. What it does is show the reader exactly how reported profit becomes underwritable profit: which add-backs were accepted, which were rejected, what supported each one, and what risks remain unresolved.
That distinction matters for lenders. A credit committee is not asking whether the statements comply with GAAP; it is asking whether the debt service coverage holds on earnings that will still exist next year. See QoE vs audit for the full comparison.
Sections of a Quality of Earnings Report
| Section | What it contains | Why the reader cares |
|---|---|---|
| Executive summary | Adjusted EBITDA by period, key findings, unresolved items | The one page decision-makers actually read |
| EBITDA bridge | Reported EBITDA to adjusted EBITDA, one line per adjustment | Shows the magnitude and composition of every change |
| Adjustment detail | Each add-back with amount, period, rationale, and supporting transactions | Lets the reader accept or reject adjustments individually |
| Proof of cash | Monthly tie-out of recorded revenue to bank deposits | Tests whether the books reflect real money |
| Revenue analysis | Recurring vs one-time, customer concentration, pricing vs volume | Predicts whether revenue persists post-close |
| Working capital | Historical levels and a normalized peg | Sets the closing working capital target |
| Balance sheet review | Account composition, unusual balances, related-party items | Surfaces liabilities the price should account for |
| Findings & risks | Red flags, data limitations, scope exclusions | Tells the reader what the analysis could not confirm |
What the Deliverable Looks Like
A complete package is two artifacts: a narrative PDF report and structured Excel workpapers. The Excel workbook matters as much as the PDF — a reviewer may want to inspect the inputs, supporting records where available, and decisions behind an adjustment. Shepi exports structured workpapers in its own format; they are not a live-formula model.
Narrative PDF
Executive summary, adjustment rationale, findings, and scope statement
Excel workpapers
Trial balance, mapped accounts, adjustment schedule, EBITDA bridge, and supporting tabs
Evidence trail
Supported adjustments link to underlying transactions; missing lineage is shown instead of inferred
Review decisions
Confirm or dispute a supported conclusion in the project before exporting the updated package
Walk through the sample project to inspect evidence, make a practice review decision, and view both watermarked deliverable previews. Or start with the QoE report structure.
Who Reads the Report
Acquisition lenders
Underwriting debt service coverage against sustainable earnings
Buyers and investment committees
Validating the price and identifying renegotiation items
Sellers and brokers
Pre-empting buyer objections with a sell-side report
Deal counsel and CPAs
Drafting purchase agreement definitions of EBITDA and working capital
How to Get a QoE Report
Gather the data room
Three years plus TTM financials, general ledger, bank and card statements, payroll registers, and tax returns.
Run the analysis
Shepi maps accounts, checks the trial balance, scans imported GL records, and surfaces adjustment candidates.
Review the adjustments
Accept, reject, or edit each proposed add-back. Every change flows through the bridge automatically.
Export the package
Generate the narrative PDF and Excel workbook. Done-For-You engagements include licensed CPA review before delivery.