M&A Readiness / Worksheet

Net Working Capital Peg Worksheet

Name: Glacier Lake Partners
Telephone: +1 (808) 388-2570
Price range: $$$$

A worksheet for preparing the working capital peg, sample calculation, exclusions, seasonality adjustments, and dispute support file.

Worksheet4 related articlesEditable workspaceReviewed 2026-06-29

Best used for

Use before LOI negotiation and again before signing the purchase agreement.

Complete it in-browser, score readiness, export an executive summary, or send the completed tool for review.

86/100Board-ready

Readiness score

86/100 · Board-ready

Use the output as a working draft for diligence, governance, or management review.

32 of 37 fields completed. Session autosaves locally.

Dynamic risk flags

1 high-priority flags

HighMethodology decisions is underbuilt

This section is below a buyer-ready or governance-ready threshold and should get an owner before external use.

Editable worksheet

Sample peg worksheet

Line Item	Include / Exclude	Seller Position	Support Needed
Accounts receivable	Include	Use gross AR less historically consistent reserve	AR aging, collections after period-end, reserve policy
Inventory	Include	Use ordinary-course inventory net of historical reserve	Inventory report, count support, obsolete/slow-moving analysis
Prepaid expenses	Include if operating	Include only transferable operating prepaids	Prepaid schedule, contract support
Accounts payable	Include	Include ordinary-course trade AP with cutoff support	AP aging, vendor statements, subsequent invoices
Accrued payroll and bonuses	Depends	Include ordinary operating accruals; separate transaction bonuses	Payroll registers, bonus plans, cutoff support
Deferred revenue	Depends	Coordinate with cost-to-fulfill and agreement definition	Deferred revenue schedule, fulfillment cost analysis
Cash and debt	Exclude	Treat under cash-free/debt-free mechanics unless agreement says otherwise	Debt schedule, bank statements, payoff letters
Transaction expenses	Exclude from NWC	Classify separately to avoid double counting	Advisor invoices, bonuses, legal/accounting fees

Editable checklist

Methodology decisions

Choose historical period and explain why it reflects ordinary-course working capital.
Normalize for seasonality, growth, unusual collections, unusual inventory builds, and one-time events.
Attach a sample calculation with account mapping and exclusions before signing.
Define whether the hierarchy is agreement language, sample calculation, historical practice, then GAAP.
Prepare support by line item before the buyer prepares the first closing statement.

Who it is for

Founder, CFO, controller, or advisor negotiating LOI and purchase agreement mechanics.

Evidence to collect

Trial balance mapping to included and excluded working capital accounts.
Monthly historical working capital schedule with rationale for the selected period.
Line-item support for reserves, deferred revenue, accruals, inventory, AR, AP, and transaction expenses.

Common mistakes

Assuming GAAP working capital and purchase-agreement working capital are the same thing.
Negotiating a peg without a sample calculation and account-by-account treatment.
Ignoring seasonality, growth, deferred revenue, transaction expenses, or unusual cutoff patterns.

Industry variants

Inventory-heavy business

Add obsolete inventory, cycle count, purchase cutoff, and reserve support.

Deferred revenue model

Add fulfillment cost, liability treatment, and agreement definition review.

Project-based services

Add WIP, accrued costs, retainage, and billing cutoff support.

Recommended next step

Review NWC peg exposure

Best before LOI or before purchase agreement language locks in the sample calculation.

View service

These templates are starting points for internal planning and diligence preparation. They are not legal, tax, accounting, investment, or compliance advice. Review transaction, employment, tax, regulatory, and AI governance questions with qualified advisors before relying on a final position.

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Next Step

A template is useful. Judgment still matters.

If the tool surfaced gaps around buyer diligence, AI governance, working capital, or contract risk, Glacier Lake can help turn the worksheet into an execution plan.

Confidential inquiriesReviewed personally1 business day response target

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Direct contact

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