Quality of Earnings: What Buyers Really Look for in Merger & Acquisition Transactions Webinar

To provide CPAs and finance professionals with the knowledge, analytical tools, and adjustment frameworks needed to execute thorough QoE reviews and maximize value throughout the transaction lifecycle.

• QoE foundations
  – What buyers really look for
  – QoE analyses compared to attest engagements and related workstreams
  – QoE as a management and negotiation tool
  – Where QoE touches the price equation
  – Typical QoE workflows
  – Evidence hierarchy in QoE analyses
  – QoE report anatomy
• Earnings quality and EBITDA adjustments
  – Earnings quality framework
  – GAAP results to adjusted EBITDA
  – Adjustment quality spectrum
  – Common QoE adjustment categories
  – Revenue quality
  – Expense and margin quality
  – Cash conversion
  – High-frequency adjustments
• Working capital, net debt, and price mechanics
  – How QoE ties to the purchase agreement
  – Net working capital analysis
  – Working capital peg methods
  – Debt-like items
  – Taxes and contingencies
• Private company targets
  – Private company red flags
• Public company targets and carve-outs
  – Public company acquisition reporting overlay
  – Public company segment and expense visibility

Bill Witt, Director, Highspring

Bill Witt is a Director in the Accounting and Transaction Services (A&TS) practice at Highspring, where he specializes in advising clients on complex initial public offering (IPO) transactions, SEC filings, and technical accounting matters. With over 25 years of experience in technical accounting and financial reporting leadership, Bill is a trusted advisor to clients navigating high-stakes financial events.

His technical expertise spans a range of industries including fintech, biotechnology, and SaaS, with a proven track record supporting multiple IPOs and leading engagements involving ASC 606, lease accounting, and other critical accounting standards. Bill has developed and delivered training programs on the IPO process and technical accounting topics, positioning him as both a subject-matter expert and educator.

In addition to IPO readiness, Bill has extensive experience in financial transformation, including the optimization of close processes, the development of robust forecasting models, and the preparation of companies for complex equity and debt transactions. He is skilled in leading cross-functional teams and managing high-complexity projects involving corporate governance, post-merger integration, and strategic financial planning.

Prior to joining Highspring, Bill was a Senior Manager at Ernst & Young LLP, serving clients in both San Jose, California, and Atlanta, Georgia. He is a Certified Public Accountant (CPA) licensed in California, Georgia, and Ohio.

To provide CPAs and finance professionals with the knowledge, analytical tools, and adjustment frameworks needed to execute thorough QoE reviews and maximize value throughout the transaction lifecycle.

DETAILED LEARNING OBJECTIVES

• Identify the primary purpose of a quality of earnings analysis

• Distinguish a quality of earnings analysis from an audit or review engagement

• Determine how debt-like items affect the calculation of equity price from enterprise value

• Identify the types of evidence that provide reliable support for a quality of earnings adjustment

• Distinguish buyer-generated synergies from adjustments to the target’s historical earnings

• Recognize indicators of revenue quality and cash conversion concerns

• Determine the appropriate normalization treatment for above-market owner compensation

• Identify the operating liquidity considerations used to establish a working capital peg

• Recognize obligations that may be classified as debt-like items in a transaction

• Evaluate how customer concentration and the absence of contracts may affect the durability and transferability of earnings

• QoE foundations
  – What buyers really look for
  – QoE analyses compared to attest engagements and related workstreams
  – QoE as a management and negotiation tool
  – Where QoE touches the price equation
  – Typical QoE workflows
  – Evidence hierarchy in QoE analyses
  – QoE report anatomy
• Earnings quality and EBITDA adjustments
  – Earnings quality framework
  – GAAP results to adjusted EBITDA
  – Adjustment quality spectrum
  – Common QoE adjustment categories
  – Revenue quality
  – Expense and margin quality
  – Cash conversion
  – High-frequency adjustments
• Working capital, net debt, and price mechanics
  – How QoE ties to the purchase agreement
  – Net working capital analysis
  – Working capital peg methods
  – Debt-like items
  – Taxes and contingencies
• Private company targets
  – Private company red flags
• Public company targets and carve-outs
  – Public company acquisition reporting overlay
  – Public company segment and expense visibility

Bill Witt, Director, Highspring

Bill Witt is a Director in the Accounting and Transaction Services (A&TS) practice at Highspring, where he specializes in advising clients on complex initial public offering (IPO) transactions, SEC filings, and technical accounting matters. With over 25 years of experience in technical accounting and financial reporting leadership, Bill is a trusted advisor to clients navigating high-stakes financial events.

His technical expertise spans a range of industries including fintech, biotechnology, and SaaS, with a proven track record supporting multiple IPOs and leading engagements involving ASC 606, lease accounting, and other critical accounting standards. Bill has developed and delivered training programs on the IPO process and technical accounting topics, positioning him as both a subject-matter expert and educator.

In addition to IPO readiness, Bill has extensive experience in financial transformation, including the optimization of close processes, the development of robust forecasting models, and the preparation of companies for complex equity and debt transactions. He is skilled in leading cross-functional teams and managing high-complexity projects involving corporate governance, post-merger integration, and strategic financial planning.

Prior to joining Highspring, Bill was a Senior Manager at Ernst & Young LLP, serving clients in both San Jose, California, and Atlanta, Georgia. He is a Certified Public Accountant (CPA) licensed in California, Georgia, and Ohio.