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What Are The Key Adjustments To Recast Discretionary Income?

By Hoke - Last updated: Sunday, August 1, 2010 - Save & Share - Leave a Comment

The main Adjustments are:
1. Owner’s Salary
2. Interest
3. Depreciation
4. Amortization
5. Owners Perks
6. Non Recurring Expenses

The above items are typically added to Discretionary Income. Proper Recasting the Income Statements is very important. Understating the Recast will leave “money on the table”. Overstating the Recast creates an unpleasant surprise or can possibly “kill the deal” if discovered during Due Diligence or later.


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Posted in Business Valuation, Due Diligence, Financial Documentation, Preparing the Business for Sale • • Top Of Page