Question

What lesson can be derived from the presence of multiple income statements during a business sale?


Financial transparency is a non-issue in buyouts


Due diligence must include a forensic financial review


Tax returns always reflect true profitability


All businesses prepare income statements in triplicate

Answer 1

The most relevant lesson derived from the presence of multiple income statements during a business sale is:

**Due diligence must include a forensic financial review.**

Multiple income statements can indicate discrepancies or varying interpretations of the company's financial performance. This highlights the importance of conducting a thorough financial investigation to uncover the true state of the business and ascertain its actual profitability.