Wages Paid in Cash

by a searcher from Southern Methodist University - Edwin L. Cox School of Business

3 days ago

Does anyone have experience diligencing businesses that pay a significant portion of their payroll in cash?  Seems like a giant red flag to me but maybe I'm mssing something.

0 likes
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14 comments

searcher from Western State University College of Law - Orange County

The concerns addressed above will likely only magnify in the coming years.

7 hours ago | like reply | 0 likes

searcher from Massachusetts Institute of Technology

I think this is a bit of a red flag, but as some of the others have commented, might just be the way that business is done currently in some areas. If you do want to go forward, I'd recommend that 1) you don't continue doing business this way, so make sure that you are understanding what this transition would be like as part of diligence 2) overestimate cash costs as part of your valuation and 3) assume zero cash income as part of your diligence

8 hours ago | like reply | 0 likes

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