Do you know which one you're dating? Ms. Cash and Ms. Accrual walk into a bar. Do you know which one you're dating? In 16 years of small deals, I've never seen 100% cash or 100% accrual. It's always somewhere in between. Which means you need to know how to spot what you're actually looking at. Here's the quick tell: No accounts receivable or accounts payable on the balance sheet? You're probably dating Ms. Cash. Six months of income statements that look plus or minus the same? That's Ms. Accrual. Cash-basis financials swing up and down depending on when cash was accepted. Neither is unsafe. But games get played between the two. And if you don't know what you're looking at before you sign an LOI, you're flying blind into a deal that could blow up post-close. redacted