Comparison
Pre-screen, Quality of Earnings, or full due diligence — which does your deal need?
There are three levels of checking a small acquisition, and they cost roughly $600, $20,000 and $50,000. They answer different questions, and doing them in the wrong order is how first-time buyers spend real money learning that a deal was never viable.
QoE figures below are published 2026 fee ranges from two providers serving different ends of the market (Bedrock; BD Emerson) — there is no list price for this work. Full due-diligence costs remain advisory-market estimates. All vary widely with size and complexity.
The three levels
| Pre-screen | Quality of Earnings | Full due diligence | |
|---|---|---|---|
| Question it answers | Is this deal worth professional fees at all? | Are the earnings real and repeatable? | What exactly am I buying, and what comes with it? |
| Who does it | Software, on your documents | A CPA firm | Attorney + CPA + valuation, sometimes an insurance and IT review |
| Typical cost | $597 a deal | $5,000–$15,000 at a specialist small-deal provider; $20,000–$50,000 at a national firm | $30,000–$80,000 and up |
| Typical time | Minutes | 2–6 weeks | 4–8 weeks, overlapping |
| Depth | Everything the documents show, and what they fail to prove | Deep on earnings, narrow by design | Deep everywhere, priced accordingly |
| Right moment | The week the documents arrive | After you have chosen the deal | Under LOI, before closing |
Why the order matters more than the depth
A QoE on a small business runs from several thousand dollars to several tens of thousands, depending on who does it and how deep the work goes. Spend it once, on the deal you have decided to buy, and it is money well spent. Spend it on each of the three candidates you are comparing and the bill reaches a large part of a down payment — to eliminate two businesses that a single afternoon with the tax returns would have eliminated for nothing.
This is the trap, and it is not stupidity: there was simply no cheap layer underneath. Buyers either pay professional rates to screen, or they skip checking and sign an LOI on numbers nobody has verified. The pre-screen is the missing bottom step.
What a pre-screen can and cannot do
- It reads what you were given. Contradictions between the listing, the P&L and the returns; add-backs without evidence; coverage that fails once your salary is subtracted; a lease too short for the loan; a franchise transfer clause; a blanket lien.
- It states what the documents cannot prove. That is the point of a data-confidence measure — the gap is the finding.
- It cannot verify against the outside world. Nobody calls the customers, counts the inventory or interviews staff.
- It is not an opinion of value, a legal opinion, or an audit — and it never says "buy".
The sequence that costs least
- Documents in, pre-screen out. Kill the obviously broken deals in an afternoon, for the price of dinner.
- Negotiate with the gaps in hand. The missing-document list is leverage: it is a list of specific requests, not a vague "send me everything".
- LOI on the survivor, with conditions naming what still has to be true.
- QoE and the attorney on that one deal, funded by the money you did not spend on the other two.
A pre-screen does not replace a CPA or an attorney. It decides which deal deserves them — and gives you the questions to bring when you get there.
For what a QoE contains, what different providers charge for it, and the SBA rule that makes one mandatory above $3,000,000 from 1 October 2026, see the full guide to Quality of Earnings reports.
Questions buyers ask
Do I need a Quality of Earnings review on a $500,000 business?
Often yes, once you have chosen the deal — but not on every candidate. Published 2026 fees start around $5,000–$8,000 at providers built for small deals and reach $20,000–$35,000 at national firms for the same size of business, because the scope differs. Either figure is defensible on the deal you intend to buy and ruinous as a screening tool. Screen cheaply first, then buy the QoE for the survivor.
Can software replace due diligence?
No. Software reads the documents you were given and reports what they show and what they fail to prove. It cannot call customers, count stock, interview staff, or give legal advice. Its job is to decide whether a deal deserves the people who do those things.
Related
Have the documents already? A DealLoupe pre-screen reads them and reports the red flags, the gaps and the questions to ask — before you spend anything on due diligence. See what it costs →
Last updated: 2026-09-21