See where profit, cash and enterprise value may be leaking before sale, succession, refinancing or buyer scrutiny.
A practical diagnostic for founders, accountants and advisers to identify where EBITDA quality, cash conversion, founder dependency, reporting gaps and operational complexity may reduce business value.
A business can be profitable and still lose value in the eyes of buyers, lenders, successors or boards.
The issue is rarely one number. It is usually the gap between what the accounts show and what the operating system can prove.
This diagnostic translates financial symptoms into commercial consequences: EBITDA defensibility, cash conversion, management dependency, buyer confidence and operational visibility.
Preparing for sale, succession, refinancing or a buyer approach.
Helping clients understand where financial symptoms point to deeper operating causes.
Testing whether profit, cash flow, reporting and management depth will withstand scrutiny.
Identifying value leakage before diligence, lender review or valuation discussions.
Answer each question based on your current operating reality. All 30 questions must be completed before the result is generated. For each question, select the option that most accurately reflects the business.
These fields do not affect the diagnostic score. They are used only to personalise the downloadable report.
0 of 30 questions answered
Strong = clear evidence · Partial = inconsistent evidence · Weak = limited evidence · Unsure = not known
Tests whether earnings can survive buyer, lender or board scrutiny.
EBITDA growth can be clearly explained by specific operating drivers.
Gross margin is stable and visible by customer, product, channel or site.
Normalisations and one-off adjustments are clean, evidence-backed and easy to explain.
Revenue growth consistently converts into profit growth.
Rebates, discounts, freight, warranty and overhead leakage are understood.
Tests whether reported profit turns into usable cash.
EBITDA converts reliably into operating cash flow.
Debtor days are controlled and not stretching behind revenue growth.
Inventory is not growing faster than sales without a clear reason.
Working capital movements are forecastable and actively managed.
Cash pressure is not increasing despite reported profitability.
Tests whether revenue is valuable, repeatable and defensible.
Customer concentration is understood and commercially managed.
Key customers are profitable after rebates, freight, service cost and trading terms.
Revenue is repeatable rather than dependent on one-off wins.
Price increases are disciplined, measured and retained.
Sales pipeline is credible, conversion-based and not just activity-based.
Tests whether the business can operate without the founder or one key person.
The founder is not the only person holding key customer relationships.
The business can operate for 30–60 days without the owner in daily decisions.
There is a capable second layer of management.
Decision-making is delegated through clear accountability.
Managers own meaningful KPIs and operating outcomes.
Tests whether the business can prove how it performs.
Monthly results are reliable, timely and decision-grade.
Operational KPIs are visible beyond the P&L.
Branches, divisions, products or channels can be benchmarked.
Management can identify where margin is made or lost.
Systems produce information that supports action, not just reporting.
Tests whether growth has created hidden cost, cash and execution drag.
Underperforming sites, divisions or teams are visible and actively managed.
SKU, product or service complexity is controlled.
Inventory complexity is not creating unnecessary working capital drag.
Low-quality customers are identified after cost-to-serve.
Freight, rebates, discounts and service expectations are not silently eroding margin.
Based on lowest category scores from this assessment.
The diagnostic produces a structured assessment showing overall value readiness, category-level exposure and a prioritised action path. The report is designed to be shared with clients, advisers, boards or finance teams.
Top Three Value Leakage Areas
Focus on working capital, debtor discipline, inventory quality and cash conversion before valuation, refinancing or sale discussions.
Accountants often see the warning signs first: profit not converting to cash, margins moving without explanation, owner dependency, working capital pressure, weak reporting or valuation expectations the business cannot yet defend.
This diagnostic gives advisers a structured way to turn those financial symptoms into an operating conversation without replacing the accountant, broker, CFO or M&A adviser relationship.
These articles expand on the operating causes behind each diagnostic category.
Use the diagnostic to identify where a business may be exposed before sale, succession, refinancing, buyer scrutiny or a performance reset.