# Review EBITDA adjustments for credibility

A line-by-line test of adjusted EBITDA add-backs with support needed, risk rating, and a defensible adjusted figure.

- Topic: Finance & Accounting
- Framework: Few-Shot
- Level: Standard
- Tags: Finance, Legal, Analyze, Fill-in Template
- Source: https://www.thinkwithprompt.com/prompts/review-ebitda-adjustments-for-credibility

## Prompt

```text
Review the adjustments behind an adjusted EBITDA figure.

**Context:** [e.g. "our board reporting", "a target in an acquisition", "lender covenant reporting", "fundraising materials"]
**Reported EBITDA:** [AMOUNT and period]
**Adjustments proposed:** [PASTE each: description, amount, and explanation]
**Supporting evidence available:** [invoices, contracts, payroll records, board minutes]
**Any definitions we must follow:** [e.g. credit agreement definitions, caps on add-backs]

For each adjustment, assess:
1. Is it truly non-recurring, or does a similar cost appear every year under a different name?
2. Is it outside normal operations, or a cost of doing business (e.g. recurring restructuring, ongoing litigation)?
3. Is the amount supported by evidence, or estimated?
4. Pro forma adjustments (synergies, run-rate savings, annualized new contracts): are they achieved or only planned?
5. Are there missing negative adjustments (one-off gains, below-market owner salary, capitalized costs that should be expensed)?

Return:
- A table: Adjustment | Amount | Category | Evidence | Credibility (strong/moderate/weak) | Comment.
- A revised adjusted EBITDA range: conservative, base, and as presented.
- Questions to ask management.
- Wording guidance for presenting the figure with a reconciliation to reported EBITDA.

Use only information I provide; mark gaps [REQUEST SUPPORT]. For public reporting, non-GAAP rules apply; confirm with legal counsel and auditors.
```

## What to fill in

- AMOUNT and period
- PASTE each: description, amount, and explanation
- invoices, contracts, payroll records, board minutes
- e.g. credit agreement definitions, caps on add-backs
- REQUEST SUPPORT

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