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M&A transactions move quickly, and new SBA requirements could add another layer of complexity to the process. Beginning October 1, 2026, SBA-backed change-of-ownership transactions valued at $3 million or more will require an independent Quality of Earnings (QoE) report. The report should reconcile financial statements, tax returns, and IRS transcripts into a normalized, adjusted EBITDA figure that documents and verifies every add-back and cash flow adjustment.
If earnings don’t support the proposed deal structure, loan amounts shrink or borrowers must add equity.
This makes financial due diligence a critical factor in financing and deal execution. Buyers, lenders, and advisors who understand the new requirements early can better anticipate potential challenges, avoid last-minute surprises, and keep transactions on track. EisnerAmper’s latest article gives a full breakdown on what the new SBA rule actually means for you and how to prepare before your next deal.
