On deals with real inventory (distribution, light manufacturing, parts, retail), the balance sheet number is often the softest figure in the whole package. Many small companies book inventory once a year for the tax return, sometimes from an estimate, and the monthly P&L just runs on a standard margin in between. That matters twice. If inventory is overstated, past gross margins were overstated too, so EBITDA comes down with it. And if inventory is part of the working capital you're paying for at close, you can end up buying stock that's slow, obsolete or simply not there. What I'd ask for early: - An item-level listing with quantities, unit costs and last sale or usage date - How the year-end count was done, and who did it - Write-offs or "shrink" adjustments over the last three years Then plan a physical count close to closing, with the seller in the room, and tie the result into the purchase agreement. Lenders tend to like seeing that step too, since inventory is often part of the collateral. Have you had a count change the deal, either the price or the working capital target?