Adjustment Schedule/Add Backs
Adjusted net profits are usually before owner’s salary, items such as tax, interest on finance and depreciation and standard recognised add back items – see below defination
“It is normal market practice to establish the profitability of a business prior to any financing charges, any items of expenditure considered to be non-operating, non-recurring and/or abnormal in nature or of particular benefit to the Directors/Owners/Partners”
A separate financial schedule shows an adjustment schedule which demonstrates some of the benefits the business provides to Directors / Owners, the adjustment schedule should be read in conjunction with the Trading and Profit & Loss statements.
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