Credit Card Cash Back Points as an Add Back?
Hi, has anyone seen CC cash back points added back to SDE? Seems a bit intuitive to do so, but not a true reflection of the business, or is it?
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by a searcher
from Northwestern University - Kellogg School of Management
in Chicago, IL, USA
in Chicago, IL, USA
1yr ago
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by a searcher
1yr ago
from Harvard University in Portland, OR, USA
from Harvard University in Portland, OR, USA
Saw this on an investment I looked at. Would not recommend taking the addback. Not a true reflection of the biz. Also if its CC points derived from a PG-business card, there is no guarantee that you have that same benefit. Also traditionally tied to spending so when downward adjusting COGS/SG&A for addbacks, would also need to adjust CC benefits.
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by a searcher
1yr ago
from Washington University in St. Louis in Chesterfield, MO, USA
from Washington University in St. Louis in Chesterfield, MO, USA
probably depends on how the business is structured -- if the points flow to the business vs. the owner it may make a difference. Generally though, wouldn't consider it as additional income in evaluating the cash flow of the business.
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