Balance sheet in diligence

Make sure you understand the balance sheet as you conduct your diligence. A Company's balance sheet being inaccurate can result in significant EBITDA adjustments. A quick check on the accounting quality of a target is to ask them for their balance sheet account reconciliations for the last twelve months. If they don't have account reconciliations its likely you will find issues during diligence and may encounter a longer QofE process.