Glossary · Reading the business
Audited financial statements
In short
These are financial reports (P&L, Balance Sheet, Cash Flow) that have been reviewed and verified by an independent CPA. They offer the highest level of assurance regarding financial accuracy.
What it means in a deal
While not always available for small businesses, audited financials provide the most reliable view of a company's historical performance. If the seller has them, your CPA will scrutinize them for anomalies. If not, you'll rely on reviewed or compiled statements, and tax returns, requiring more thorough due diligence.
Related terms
Common questions about Audited financial statements
- Do I need to provide personal financial statements for an SBA 7(a) loan?
- What types of personal financial statements are required for an SBA 7(a) loan?
- What types of personal financial statements are typically required for an SBA 7(a) loan application?
- Can unverified or inconsistent financial statements from the seller cause my SBA loan to be denied?
- What kind of financial statements does the SBA 7(a) loan application require from my business?
- What specific due diligence does the lender perform on the target business's financial statements for an acquisition?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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