Proof the line has to carry
Invoices, payroll registers, mileage logs, settlement statements, and a date. If the only evidence is a sentence in the CIM, the line is a wish. Buyers who pay for quality of earnings will sample the same vendors and the same months.
BLS OEWS May 2025 national medians — machinist $58,750, welder $53,750 — are useful when the add-back is “family on the floor at below-market wages” (Source: BLS). They are not a hall pass to invent a replacement rate for a programmer the file never employed.
Lines that are not add-backs
A spindle that should have been rebuilt last year is deferred capex. Excess raw that will not sell is an inventory reserve. A second set of tooling the customer owns is not your earnings. “I stopped taking a salary in 2024” is a going-concern risk, not a gift to the buyer.
BizBuySell’s manufacturing median of 2.75x SDE means a $40,000 fake add-back is a six-figure enterprise-value argument on a Main Street file (Source: BizBuySell). Treat the line like cash, because that is how the other side will treat the rejection.
| Proposed line | Better home |
|---|---|
| Owner’s personal aircraft | Add-back if purely personal and documented |
| Overdue press rebuild | Price chip / escrow, not earnings |
| Obsolete finished goods | Inventory reserve in the peg |
| Buyer’s planned plant combo | Buyer synergy, never seller add-back |
How many add-backs should a CIM show?
As many as you can prove and as few as you can defend. A twelve-line schedule that is clean beats a thirty-line schedule that invites a QoE fishing trip. Adjusted EBITDA is the result after the lines that survive. This noun is one line.
Census CBP 2023’s establishment file is context for how often the owner is still the scarce operator (Source: Census CBP). It does not decide whether the lodge is personal.
What this page refuses
It refuses to bless a line without paper. It refuses to call Jason Taken a QoE accountant — he is a business broker. It refuses a state multiple. Educational information only. Counsel and a CPA own tax treatment of the same dollars.
How to keep the schedule short enough to defend
Group personal items. Date the one-time items. Put family wages in one row with a market reset, not in five stories. Leave future “I will hire cheaper” lines off. Leave synergies off. Leave unfunded capex off. If you cannot fit the keepers on one page with binders behind them, you do not have a schedule. You have a novel.
Buyers will sample the largest lines first. Make those the cleanest. The glossary and the FAQ split the noun from the question. When the schedule is real, book a confidential intro call.
A worked pattern that dies, and one that lives
Dies: “marketing was unusually high because we tried a trade show.” If the shop goes to that show most years, it is not one-time. Lives: a documented flood year with invoices, insurance, and a date that will not repeat. Dies: “I could hire a GM for $90,000.” Lives: a signed offer or a recruiter write-up at $140,000 that you use as the replacement, which reduces SDE rather than puffing it.
Write the pattern you are actually in. Do not collect both as if they were the same species of line.
Personal mixed with business, the line that always gets sampled
The truck that tows a boat on Sunday and hauls fixtures on Monday will be sampled. The phone that is on the company plan and is also the family plan will be sampled. Split them with statements or leave the whole line out. Partial stories are worse than omissions because they teach the QoE team that every line needs a forensic pass.
Keep the schedule boring. Boring schedules close. Novelistic schedules become the deal.
Every kept line has a binder. Every rejected line has a home in cash, a reserve, or “not earnings.” That is the whole craft. A CIM that publishes a fourteen-line schedule without invoices is asking the QoE firm to do the seller’s homework. Add-backs in manufacturing is the full schedule. After the line noun is straight, a confidential intro call is the conversion path.