Prepare for Higher Number with Deal Structure Analysis

When analyzing the income statement, it is essential to consider all elements from revenue to gross margin, GNA expenses, net income, and cash flow to understand the business's true financial position. Even if confidence levels are not high, preparing for a higher number is advisable. In negotiations, sellers may have a stronger belief in their business, but it is crucial to mitigate risks by discussing deal structures like clawbacks and earnouts to address trustee concerns.