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/install afrexai-financial-due-diligence
Description
Performs detailed financial due diligence on deals by analyzing earnings quality, working capital, revenue, liabilities, cash flow, red flags, and valuation...
README (SKILL.md)
Financial Due Diligence Analyzer
Run comprehensive financial due diligence on acquisition targets, investment opportunities, or partnership prospects. Built for PE firms, corporate development teams, and founders evaluating deals.
What This Does
Generates a complete due diligence package:
- Quality of Earnings (QoE) — normalize EBITDA, strip one-time items, identify recurring vs non-recurring revenue
- Working Capital Analysis — NWC trends, peg calculation, seasonal adjustments
- Revenue Quality — customer concentration, churn, cohort analysis, contract backlog
- Debt & Liabilities — hidden obligations, off-balance-sheet items, contingent liabilities
- Cash Flow Bridge — EBITDA to free cash flow conversion, capex requirements
- Red Flag Scanner — 23 common deal-killers ranked by severity
How to Use
Tell your agent: "Run financial due diligence on [company/deal]"
Provide what you have:
- Financial statements (P&L, balance sheet, cash flow) — even partial
- Revenue breakdown by customer/product
- Known deal terms (purchase price, structure)
The agent will generate a structured diligence report with findings, risks, and negotiation points.
QoE Framework
EBITDA Normalization Checklist
| Adjustment Category | Common Items | Direction |
|---|---|---|
| Owner compensation | Above/below market salary, personal expenses | +/- |
| One-time revenue | PPP loans, insurance claims, litigation settlements | - |
| One-time expenses | Restructuring, M&A costs, natural disaster | + |
| Related party | Above/below market rent, intercompany charges | +/- |
| Accounting changes | Revenue recognition timing, reserve adjustments | +/- |
| Run-rate adjustments | New contracts, lost customers, price changes | +/- |
Revenue Quality Score (0-100)
| Factor | Weight | Scoring |
|---|---|---|
| Recurring vs one-time | 25% | >80% recurring = 25, >60% = 18, >40% = 12, \x3C40% = 5 |
| Customer concentration | 20% | Top customer \x3C10% = 20, \x3C20% = 15, \x3C30% = 10, >30% = 3 |
| Retention rate | 20% | >95% = 20, >90% = 15, >85% = 10, \x3C85% = 5 |
| Contract backlog | 15% | >12mo coverage = 15, >6mo = 10, >3mo = 6, \x3C3mo = 2 |
| Growth trajectory | 10% | >30% YoY = 10, >15% = 7, >5% = 4, declining = 1 |
| Pricing power | 10% | Annual increases + low churn = 10, some = 6, none = 2 |
Working Capital Peg
NWC Peg = Average of trailing 12 months normalized NWC
Normalized NWC = Current Assets (excl. cash) - Current Liabilities (excl. debt)
Adjustments:
- Remove seasonal spikes (use monthly data, not quarterly)
- Strip one-time receivables/payables
- Normalize inventory to steady-state
- Adjust for known post-close changes
If NWC at close > Peg → Seller receives difference
If NWC at close \x3C Peg → Buyer receives difference
Red Flag Scanner (23 Points)
Critical (Deal-killers)
- Revenue concentration >40% single customer
- Declining revenue with no credible turnaround plan
- Negative or deteriorating cash conversion (EBITDA to FCF \x3C50%)
- Undisclosed litigation or regulatory action
- Key person dependency with no succession plan
- Material related-party transactions at off-market terms
- Unrecorded liabilities (tax, environmental, legal)
Serious (Price adjustments)
- Customer churn accelerating quarter-over-quarter
- Gross margin compression >200bps annually
- Capex requirements understated (deferred maintenance)
- Working capital trends moving against buyer
- Aggressive revenue recognition policies
- Unusual pre-close transactions (dividends, bonuses)
- Technology debt requiring material investment
- Regulatory changes threatening core business model
Notable (Negotiation points)
- Management team retention risk
- Vendor concentration >30% single supplier
- IP ownership gaps or licensing dependencies
- Insurance coverage gaps
- Environmental liabilities (real estate)
- Employee benefit obligations (pension, OPEB)
- Tax position optimization opportunities
- Integration complexity indicators
Valuation Sanity Check
Quick Multiples Reference (2025-2026)
| Sector | EV/Revenue | EV/EBITDA | Notes |
|---|---|---|---|
| SaaS (\x3C$10M ARR) | 4-8x | 15-25x | Higher for >120% NRR |
| SaaS ($10-50M ARR) | 6-12x | 20-35x | Rule of 40 premium |
| Professional Services | 1-2x | 8-12x | People-dependent discount |
| Manufacturing | 0.5-1.5x | 6-10x | Asset-heavy adjustment |
| Healthcare Services | 1-3x | 10-15x | Regulatory moat premium |
| Fintech | 5-15x | 20-40x | Wide range, growth-dependent |
| E-commerce | 1-3x | 10-18x | Brand and margin quality |
Purchase Price Allocation
Enterprise Value
- Net Debt (total debt - cash)
- Transaction Expenses
- Working Capital Adjustment (vs Peg)
+ Earnout (if applicable, risk-adjusted at 50-70% probability)
= Equity Value to Seller
Output Format
Your due diligence report should include:
- Executive Summary — deal overview, key findings, go/no-go recommendation
- Quality of Earnings — normalized EBITDA bridge with adjustments
- Revenue Analysis — quality score, concentration, trends
- Working Capital — NWC peg, seasonal analysis, close estimate
- Cash Flow — EBITDA to FCF bridge, capex analysis
- Red Flags — scored findings with severity and $ impact
- Valuation Check — multiples comparison, sanity test
- Negotiation Points — specific items for purchase agreement
Built by AfrexAI — AI context packs for business operations ($47 each).
More tools:
- AI Revenue Leak Calculator — Find where you're losing money
- Agent Setup Wizard — Deploy AI agents in minutes
- Full Context Pack Store — 10 industry packs, $47 each
Usage Guidance
This skill is coherent and appears to do what it claims, but before using it: 1) Only provide financial documents to agents/services you trust and that meet your confidentiality requirements; 2) Test the skill with non-sensitive sample data first to verify output format and assumptions; 3) Treat its findings as advisory — have a qualified human reviewer validate adjustments, valuations, and negotiation points; and 4) If you plan to use this in production, confirm the vendor/author (AfrexAI links) and their data-handling/privacy practices.
Capability Analysis
Type: OpenClaw Skill
Name: afrexai-financial-due-diligence
Version: 1.0.0
The skill bundle contains only metadata and documentation files (`_meta.json`, `SKILL.md`, `README.md`). The `SKILL.md` file, which serves as instructions for the AI agent, details a comprehensive financial due diligence process. There are no executable scripts, no instructions for data exfiltration, unauthorized network calls, persistence mechanisms, or any form of prompt injection designed to subvert the agent's intended function. The external links present in the documentation are marketing-related and do not instruct the agent to perform any action with them. The content is entirely aligned with the stated purpose of financial analysis.
Capability Assessment
Purpose & Capability
Name, description, and provided checklists/outputs align with a financial due-diligence tool; nothing in the manifest asks for unrelated capabilities (no cloud creds, no binaries, no unusual config paths).
Instruction Scope
SKILL.md confines the agent to analyzing user-supplied financials and deal terms and producing a structured report; it does not instruct the agent to read system files, gather environment variables, or transmit data to unknown endpoints. Note: the skill expects users to provide potentially sensitive financial documents, which is normal for this use case but a privacy consideration.
Install Mechanism
Instruction-only skill with no install spec and no code files — lowest-risk installation surface (nothing written to disk by the skill itself).
Credentials
No environment variables, credentials, or config paths are requested; required access is proportional to the stated purpose (analysis of provided financial inputs).
Persistence & Privilege
Skill is not always:on, does not request persistent system-level presence, and uses the platform's normal autonomous-invocation default without combining that with broad access.
How to Use
- Make sure OpenClaw is installed (local or Docker)
- Run the install command in chat:
/install afrexai-financial-due-diligence - After installation, invoke the skill by name or use
/afrexai-financial-due-diligence - Provide required inputs per the skill's parameter spec and get structured output
Version History
v1.0.0
- Initial public release of the Financial Due Diligence Analyzer skill.
- Provides automated due diligence reports, including Quality of Earnings, working capital analysis, revenue concentration, debt and liabilities, cash flow, and a red flag scanner.
- Features a customizable EBITDA normalization checklist and revenue quality scoring framework.
- Includes working capital peg calculation, red flag severity ranking, and industry valuation multipliers.
- Outputs comprehensive diligence packages with negotiation points and valuation sanity checks.
Metadata
Frequently Asked Questions
What is Financial Due Diligence Analyzer?
Performs detailed financial due diligence on deals by analyzing earnings quality, working capital, revenue, liabilities, cash flow, red flags, and valuation... It is an AI Agent Skill for Claude Code / OpenClaw, with 1633 downloads so far.
How do I install Financial Due Diligence Analyzer?
Run "/install afrexai-financial-due-diligence" in the OpenClaw or Claude Code chat to install it in one step — no extra setup required.
Is Financial Due Diligence Analyzer free?
Yes, Financial Due Diligence Analyzer is completely free (open-source). You can download, install and use it at no cost.
Which platforms does Financial Due Diligence Analyzer support?
Financial Due Diligence Analyzer is cross-platform and runs anywhere OpenClaw / Claude Code is available (cross-platform).
Who created Financial Due Diligence Analyzer?
It is built and maintained by 1kalin (@1kalin); the current version is v1.0.0.
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