Begin with reconciled records
Collect recent tax returns, profit and loss statements, balance sheets and current monthly results. Resolve differences with the bookkeeper before a buyer asks about them.
A strong annual total loses credibility when bank activity or the balance sheet does not support it. Clean records help a buyer understand both performance and risk.
Support each adjustment separately
List owner compensation, nonrecurring costs and personal expenses with evidence and a clear reason for the proposed adjustment. Do not count the same item twice.
Owner-run SDE and adjusted EBITDA answer different questions. If a replacement manager is needed, include that cost rather than adding back all owner pay without explanation.
Explain what the earnings require
Note equipment replacement needs, owner hours and any family work paid below market. Buyers will ask what it costs to maintain the performance after the sale.
Keep the file current while the business is marketed. A buyer and lender may both ask for updates, so one organized record set can prevent conflicting answers.