SBA 7(a) Quality of Earnings
Quality of Earnings reports for SBA 7(a) loans, delivered in 5 business days.
Since October 1, 2026, SBA requires an independent Quality of Earnings report on acquisition and expansion loans with a purchase price of $3 million or more. We build that report straight from the business's accounting system and bank statements, so it arrives fast and holds up.
Cash proof
| Month | Per books | Per bank | Status |
|---|---|---|---|
| Apr 2026 | $412,380 | $412,380 | Matches |
| May 2026 | $436,915 | $436,915 | Matches |
| Jun 2026 | $398,204 | $391,454 | Difference flagged |
| Jul 2026 | $421,760 | $421,760 | Matches |
| Aug 2026 | $447,032 | $447,032 | Matches |
| Sep 2026 | $429,618 | $429,618 | Matches |
The new rule
A QoE is now part of the underwriting file.
Under SBA SOP 50 10 8.1, lenders must get an independent Quality of Earnings report for two kinds of 7(a) deals: buying a business, and an existing business buying another one in the same line of work. It applies when the purchase price is $3 million or more, not counting real estate. The rule covers loans numbered on or after October 1, 2026.
That puts the QoE in the path to approval. Most QoE providers are accounting firms that build each report by hand from exported spreadsheets and PDFs, and many quote two to three weeks. While the report is being built, the deal waits.
Rule at a glance
- Rule
- SOP 50 10 8.1, Appendix 15
- Effective
- Loans numbered on or after Oct 1, 2026
- Applies to
- Initial acquisitions and business expansions
- Threshold
- Purchase price of $3M or more, excluding real estate
- Exempt
- Owner buyouts, ESOP and co-op conversions
What a QoE does
One question: are these earnings real?
A seller's financial statements show what the business earned. A Quality of Earnings report checks whether those earnings are accurate and whether a new owner can expect them to continue. It does three things:
Adjusts the earnings.
Expenses that belong to the current owner personally, like a family member on payroll or a personal vehicle, are added back. Each adjustment is listed with its support.
Proves the cash.
Every month's deposits and withdrawals in the books are matched against the bank statements. If the books say one thing and the bank says another, the report shows it.
Tests the revenue.
It shows where revenue comes from, how concentrated it is in a few customers, and how steady it has been.
The deliverable
The report
Adjusted earnings
Each owner-related add-back, shown on both annual and monthly income statements
Cash proof
Books matched to bank statements, month by month, for the two prior fiscal years and the current year to date. Any month that does not match is flagged
Revenue quality
Revenue by customer and over time, including customer concentration
Working capital
What the business normally needs to run day to day
Business profile
Ownership, structure, and disclosures, with a written explanation for anything that needs one, like a past covenant issue
Document index
Every supporting document on file: tax returns, IRS transcripts, bank statements, legal documents
Delivered as a single document. A sample is available on request.
The process
From start to finished report.
Step 1: Start.
Send us the buyer's or seller's contact and the expected closing date.
Step 2: We connect the accounting system.
For QuickBooks Online this takes a few minutes. We load every transaction in the general ledger.
Step 3: Mapping data (about 30 minutes).
We walk through the accounts with the owner so every number lands in the right place.
About 30 minutesStep 4: QoE adjustments (30 minutes to an hour).
We go down the income statement with the owner, on screen, and identify owner-related expenses to add back.
30 to 60 minutesStep 5: Bank statements and required documents go in.
The client uploads bank statements and any additional required documents to the data room. The cash proof runs against the books automatically.
Step 6: You get the report.
Why it is fast
Most of a QoE is collecting and retyping data. We skip to the analysis.
A typical QoE starts with weeks of requests: export this report, send that spreadsheet, scan these statements. Then someone retypes it all and ties it out by hand.
We read the data directly from the accounting system, down to each transaction, and match it to the bank statements automatically. Our people spend their time on the two calls with the owner, which is the part of a QoE that needs judgment.
Typical QoE
2 to 3 weeks
Corelytics
5 business days
Valuation
An appraiser can work from the same data.
SBA still requires a business valuation, and you likely have an appraiser you trust. With the borrower's permission, we give them their own login to the same financials, adjustments, and documents. They start with everything already collected and organized.
Questions
Questions
Which deals need a QoE under the new rule?
Initial acquisitions and business expansions with a purchase price of $3 million or more, excluding real estate. Owner buyouts and ESOP or co-op conversions are exempt. Many lenders also order a QoE on smaller deals, and we do those the same way.
Does the report meet SOP 50 10 8.1?
It is built for Appendix 15: adjusted earnings with support for each adjustment, and a cash proof against bank statements.
How much work is it for the borrower?
Connecting the accounting system, uploading bank statements and documents, and two calls of about an hour each.
What if the business does not use QuickBooks Online?
We connect to other accounting systems as well. If a system will take longer than 5 business days, we tell you at the start.
Who can see the data?
The business owns its data and decides who gets access. You, your appraiser, and our team see what the owner approves.
Sample report
See a finished report.
We will send you an anonymized sample QoE so you can see exactly what your credit committee would receive.
- Adjusted earnings
- Cash proof
- Revenue quality
- Working capital
- Business profile
- Document index