ADD BACKS TO CALCULATE SDE - APPLY A HAIRCUT?

I am reviewing a P&L where the owner has considerable add-backs to calculate his SDE. Is there a general rule to apply a haircut to these personal expenses (especially when considering an SBA loan)? For due diligence (if it gets to that), I will probably ask for detailed records to prove these are truly personal expenses....any other thoughts/tips/suggestions?



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