Hi, I would love to speak with anyone who is willing to share their experience around a business that had the following characteristics that involved going through SBA
- at least half or more of the sales in form of cash
- differences in reported tax returns and the adjusted P&L
recognize this is a little sensitive area that plenty others have struggled with so would love to hear more about the things that people did to get comfortable with the risk (both from the perspective of the sales actually being there as reported by owner and having to take the business through SBA)
Diligencing a Predominantly Cash Business
by a searcher
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Few thoughts..
Cash is tricky, you can check cash deposits in bank statements but not sure it would be accurate. I would trust on Sales Tax and/or VAT tax returns on those cases
Re differences - they can be justified. Often its due to the type of accounting they use and can be reconciled. Clarity on this would come out in FDD