Transaction Advisory & Due Diligence

A deal price is built on a set of numbers — and if those numbers do not hold up, the price does not either. RN Canada's transaction advisory service gives Alberta and British Columbia owner-managers independent financial due diligence on both sides of a transaction: testing whether reported earnings are real and sustainable, whether the balance sheet is what it claims to be, and where the risks are hiding. The work is rigorous and deal-specific, because the cost of a number that turns out to be wrong is paid after closing.

What RN Canada does

• Buy-side due diligence. Examining a target's financials before you commit — validating earnings, scrutinising the balance sheet, and surfacing the risks the headline numbers do not show.
• Sell-side due diligence. Preparing your own business for scrutiny, so a buyer's diligence confirms your story rather than discovering surprises that erode the price.
• Quality-of-earnings analysis. Normalising reported earnings — removing one-off, non-recurring and owner-specific items — to reveal what the business actually earns on a repeatable basis.
• Working-capital review. Establishing the normal level of working capital the business needs to run, which sets the target for the closing-price adjustment.
• Net-debt review. Identifying all debt and debt-like items so the cash-free, debt-free price is built on a complete picture.

What the work covers

Most transactions are priced as a multiple of normalised earnings on a cash-free, debt-free basis with a normal level of working capital. Each of those three ideas is where due diligence concentrates.

Quality of earnings is the foundation. A quality-of-earnings analysis takes reported profit and strips out the items that will not recur — one-time gains, owner perks, non-arm's-length costs, accounting noise — to show the earnings a buyer is really acquiring. Because price is a multiple of that figure, a misstatement is amplified across the whole deal value.

Working capital is the second. A buyer expects to receive the business with enough working capital to keep running; the deal sets a target level, and the price is adjusted at closing for any shortfall or excess. Getting the definition and the target right protects both sides from a price that drifts between signing and closing.

Net debt is the third. Identifying every debt and debt-like item — and the cash that offsets it — ensures the headline enterprise value translates correctly into the equity price actually paid. Items that look operational but behave like debt are exactly what diligence is meant to catch.

Across all three, the underlying financial statements have to be sound, which is why we keep the applicable reporting framework — ASPE for most private companies — in view as we test the numbers.

Who it's for

This service fits owner-managers about to buy a business who need the target's numbers independently tested, owners preparing to sell who want their figures clean before a buyer's diligence, and anyone negotiating a price built on earnings, working capital and net debt. It suits Alberta and BC transactions where the gap between reported and normalised performance is large enough to move the deal.

How RN Canada helps

We test the numbers behind the deal — normalising earnings, sizing working capital, mapping net debt, and surfacing the risks — so you negotiate from evidence rather than the seller's narrative. Our founder, Ozgur Duymaz, holds a Ph.D. in accounting and finance and is a CPA (Canada), ACCA (UK) and CMA (US). Before you sign, talk to us or browse the full services overview.

This page is general information, not personalized advice. Speak to us about your specific situation.