Whoever prepares the closing statement sets the number

The estimated closing statement is the seller’s number and it sets the wire. The final closing statement is prepared after closing and it sets the true-up. Take the second one for yourself, put a hard clock on both, scope the neutral accountant narrowly, and confirm the adjustment has not quietly become your only remedy for the financial statements.

What is the difference between the estimated closing statement and the final closing statement?

The estimated closing statement is delivered before closing, usually by the seller, and it fixes the amount wired at closing. The final closing statement is prepared after closing and it fixes the true-up payment. Both measure the same targets — net working capital, cash, indebtedness, unpaid transaction expenses — as of the same moment.

Most first-time buyers treat these as one document. They are not. The estimate is the seller’s number and you have days to test it. The final statement is yours, because the books are.

I read the net working capital exhibit and its sample calculation before I read the price. Those definitions decide the number more than the target does.

How many business days before closing should the estimated closing statement be due?

A stated number of business days, with the supporting schedules attached, is the only workable deadline for the estimated closing statement. Ask for five business days. Require the trial balance, the accounts receivable and payable agings, the accrual detail, and a component-by-component calculation, not a single summary number on a cover page.

The rule is simple. A number you cannot check is a number you accepted.

Now the application. Your closing date is not floating. A lender has a funding date, a landlord holds a lease assignment, and a payoff letter expires. At first disbursement your lender documents where the proceeds went, that they match the approved use of proceeds, and that the required injection was made, often on the settlement sheet, SBA Form 1050. Stated as of September 2026, that form is not the fixed requirement it once was: SBA removed the Loan Authorization from its regulations in 2023, and later SOP versions dropped the Form 1050 mandate. Ask your lender what it collects. A late change to the wire reopens its file.

Agency material: SBA Form 1050, Settlement Sheet (OMB Control No. 3245-0200); SBA final rule removing the Loan Authorization requirement (Apr. 12, 2023), implemented for 7(a) by Procedural Notice 5000-846991. Confirm current disbursement documents with your lender.

Therefore, put the consequence in the agreement, not in an email. Two workable asks: the closing date moves a business day for every business day the estimate is late, and a late or incomplete estimate means the target itself is used at closing with the difference trued up later. Neither binds anyone outside the agreement, so clear any extension with your lender first.

A late estimated closing statement is not a discourtesy. It is a pricing strategy that works because you cannot move your funding date.

Who should prepare the final closing statement after closing?

After closing the buyer holds the general ledger, the bank accounts, and the bookkeeper, so the buyer should prepare the final closing statement. The purchase agreement should give you a fixed deadline, give the seller a defined review window with access to the supporting workpapers, and make the statement binding if the window closes in silence.

Set three clocks. One of them runs against you.

• Your deadline. A set number of days after closing to deliver the statement; sixty to ninety is a sane range. Say what happens if you miss, because the usual default makes the seller’s estimate final, punishing the party with the books.
• The seller’s review window. Thirty days from delivery of your statement to object in writing, item by item, with a proposed amount for each. Say expressly that anything not identified is waived; waiver is only as good as the words. Pair it with access to the workpapers, or the seller can argue the clock never started.
• The negotiation window. Thirty days from the objection notice before either side may go to the accountant.

Deemed acceptance does the quiet work, but only if the agreement says silence makes your statement final. Nothing about it is automatic; it is contract text. The Court of Chancery has called this shape of mechanism a run-of-the-mill accountant true-up. In one case there, the buyer prepared the balance sheet, the seller had thirty days to object or be deemed to accept, and the buyer asserted a reduction of more than twelve million dollars, over half the price. Holding the pen is leverage; it picks which argument the other side must fund.

Law: ArchKey Intermediate Holdings Inc. v. Mona, 302 A.3d 975 (Del. Ch. 2023).

What should the neutral accountant be allowed to decide?

The neutral accountant should decide only the specific line items still in dispute, acting as an expert and not as an arbitrator, applying the accounting hierarchy written into the purchase agreement, and bound by each party’s stated position as an outer limit. An unbounded mandate lets the accountant reopen items you already won.

Delaware treats expert determination as a different animal from arbitration. In Ray Beyond Corp. v. Trimaran Fund Management, the accountant was designated “an expert, not an arbitrator,” and the Court of Chancery held such language limits the decision maker to factual disputes within its expertise; that dispute turned on contract interpretation, so the court declined to compel the referral. Labels do not control either way. In ArchKey, the agreement said “arbitrator” and the court held the label did not create an agreement to arbitrate.

Law: Ray Beyond Corp. v. Trimaran Fund Mgmt., L.L.C., C.A. No. 2018-0497-KSJM (Del. Ch. Jan. 29, 2019); Penton Bus. Media Holdings, LLC v. Informa PLC, 252 A.3d 445 (Del. Ch. 2018).

So write the scope:

• Only the disputed items. Those identified in the objection notice and still unresolved, nothing else.
• Bounded by the positions. No higher than the higher stated amount, no lower than the lower, which stops a third, worse number.
• A stated hierarchy. The exhibit’s rules and sample calculation first, then the policies the business actually used, then GAAP. Attach the exhibit with a worked example from a recent month of the target’s own ledger.
• No audit. Not engaged to audit, review, or compile the balance sheet at large, and may not raise items on its own initiative.
• One submission each. Simultaneous submissions, no separate contact, a written determination inside a fixed period.
• A finality standard. Final and binding absent manifest error or mathematical error.
• Fees follow the outcome. Allocated in proportion to the amounts each side contested and lost, which disciplines you as much as the seller, plus a threshold below which nobody may refer anything.

One caution. In Chicago Bridge & Iron, working capital had to be consistent with GAAP as the seller had consistently applied it, which defeated the buyer’s push for a better view of GAAP. Aggressive historical policies become your baseline.

Does the purchase price adjustment become your only remedy?

An exclusive-remedy clause that routes everything appearing on the closing statement into the purchase price adjustment can, as written, leave the financial statements representation with no work to do. A true-up measures a balance sheet at a moment. A representation promises something was true. Confirm in writing that representation breaches and fraud travel outside the adjustment.

In Chicago Bridge & Iron Co. N.V. v. Westinghouse Electric Co., the buyer claimed the seller’s historical financial statements did not comply with GAAP and tried to route that claim to the independent auditor through the adjustment. The Court of Chancery let it. The Delaware Supreme Court reversed, calling the true-up an important but narrow, subordinate, and cabined remedy aimed at developments affecting working capital between signing and closing.

Read that holding with its facts. That agreement barred post-closing money damages on the representations, so the buyer’s only remedy for a breach was to refuse to close, and the Court weighed that bar in construing the true-up. The lesson is not that every true-up is narrow. The structure you sign decides what the mechanism reaches.

Law: Chicago Bridge & Iron Co. N.V. v. Westinghouse Elec. Co., 166 A.3d 912 (Del. 2017).

I check whether the financial statements representation survives closing before I negotiate the true-up. Inventory, receivables, and accruals sit on every closing statement, so exclusivity over all of them hands a seller who booked phantom receivables a ceiling. Ask for survival for a stated period, an indemnity reaching breaches independent of the adjustment, and fraud carved out of every limitation, in writing rather than assumed. Accept a no-double-recovery clause; wholesale exclusivity is not the same thing.

The American Bar Association’s 2023 Private Target Mergers and Acquisitions Deal Points Study reported an exclusive-remedy provision in 89 percent of the agreements reviewed, with a fraud carve-out in 87 percent of those. It samples deals many multiples larger than yours, and what travels with them, representation and warranty insurance most of all, is uncommon on a 7(a) deal. Read it for the clause shape, not as a forecast.

A true-up is a measuring device. It is not a remedy for being lied to. Keep them on separate tracks, or learn at the worst time that the drafting merged them.

Is the purchase price adjustment two-way, and is it capped?

A one-way adjustment can only reduce the price; a two-way adjustment can also require the buyer to pay the seller for working capital delivered above the target. Two-way is the symmetrical structure and it is the one to ask for. The harder questions are whether the downward adjustment is capped and how you actually collect it.

Do not assume symmetry is on offer. Agreements drafted for an individual buyer often run one way, or carry no adjustment at all. If the seller’s estimate overstates receivables and the downward cap is smaller than the overstatement, the cap is a transfer to the seller. Resist it; if one is unavoidable, insist amounts above it stay claimable as a representation breach.

Collection is the practical half. An unsecured obligation from a seller who already has the wire is a lawsuit, not a remedy. The answers are a holdback or escrow for the length of the true-up, or a right to offset against a seller note, and offset needs your lender first. Stated as of September 2026, SOP 50 10 8 took effect June 1, 2025 and governs loans that received an SBA loan number on or after that date; SOP 50 10 8.1, issued in August 2026, governs loans numbered on or after October 1, 2026 and tightens change-of-ownership underwriting. Under SOP 50 10 8, a change of ownership needs at least a 10 percent equity injection, and a seller note counted toward it must be on full standby for the term of the 7(a) loan, documented on SBA Form 155, and may supply no more than half the injection. A note on full standby is not a flexible offset target. Ask your lender how it treats a holdback and an offset right, and confirm the version in force when your loan number issues rather than relying on any summary, including this one.

Agency guidance: SBA SOP 50 10 8 (effective June 1, 2025; SBA Information Notice 5000-866746), as amended; SBA SOP 50 10 8.1 (SBA Notice 5000-880695, effective Oct. 1, 2026); SBA Form 155, Standby Agreement.

One tax item for your accountant. In an asset purchase the price is allocated under the residual method, and a true-up changes that allocation. Form 8594 has a Part III supplemental statement for an amendment reflecting changed consideration.

Law: 26 U.S.C. 1060; IRS Form 8594, Part III.

What should you do before you sign the purchase agreement?

Before signing, a buyer should fix both clocks, scope the neutral accountant in writing, and read the exclusive-remedy clause against the financial statements representation. These are drafting items, not closing items. Once the agreement is signed, the estimated closing statement arrives on the seller’s schedule and the mechanics are whatever you agreed to.

• Confirm the estimate clause states business days, lists required schedules, and says what happens if it is late.
• Confirm you prepare the final statement, and check your deadline, the objection window, access rights, deemed acceptance, and the default if you miss.
• Read the accountant clause line by line against the limits above, including fees and the referral threshold.
• Ask your lender how the true-up interacts with the use of proceeds, the disbursement paperwork, and any standby seller note.

The adjustment clause is short, dull, and mostly numbers. It also moves cash after your leverage is gone. Whoever prepares the closing statement sets the number. Make sure that is you, and that it is not the only thing you may argue.