THE SHORT ANSWER
Reconcile actual staffed and billed coverage to supported annual earnings, including employment, relief, supervision and necessary owner replacement. Define customer rights, qualified operating coverage and included assets. A contract remainder, long-term agreement or generic security multiple does not establish certified business value or cash available after financing.
Use a specified-cost service-group bridge
Reconcile achieved hours, billable scope, credits, wages, employment costs, relief, supervision and collection. Identify costs already included elsewhere before deducting them again.
| Invented aggregate service-group bridge | Amount |
|---|---|
| Assumed billing: 200 hours × $30 | $6,000 |
| Specified aggregate labor cost | −$4,000 |
| Specified employment costs | −$600 |
| Specified supervision cost | −$500 |
| Remainder after only these costs | $900 |
The specified costs total $5,100. The $900 remainder is limited to these assumptions. Review all actual service and shared costs rather than multiplying selected assignments into unsupported annual earnings.
Support payroll and annual financial adjustments
DOL’s guard fact sheet addresses covered hours/records, multiple posts and travel questions.
(DOL Fact Sheet 4: security-guard wage and hour guidance)Have qualified advisors review actual wages, overtime, time records and unresolved obligations under current federal/state/local and applicable contract requirements. The 2008 fact sheet is general guidance, not approval of the invented bridge or a complete current regulatory review.
SEC adjusted-measure guidance is an issuer presentation reference.
(SEC: non-GAAP financial measure interpretations)Have the accountant trace each actual deducted expense and future purpose. Draws, loan principal, equipment purchases and all vehicle/renovation costs are not automatic add-backs. Include necessary recruiting, scheduling, supervision and owner replacement consistently using the earnings-basis guide.
Evaluate actual customer and qualified coverage
Illinois IDFPR lists contractor, agency/branch and employee/firearm resources separately.
(Illinois IDFPR: security-profession licensing resources)Review actual entity/person/work scope and ownership-change conditions with authorities. Verify available qualified coverage, incidents, claims, insurance and customer/site conditions appropriately. A directory listing does not approve a transfer or inspect the operation.
Read contract conditions using the consent register. Seek relevant actual sold comparisons on consistent service, financial and asset definitions. Neither a generic service range, earnings threshold nor technology/retention label decides SDE, EBITDA or an automatic multiple premium.
Define assets and delivery cash independently
SBA sale guidance addresses assets, liabilities and agreement scope.
(SBA: closing or selling a business)Verify owned/leased vehicles, equipment, systems and premises through title, liens, provider rights, condition and needed investment. Determine what a proposed earnings-based price already includes before adding every asset at replacement value. Separate personal and customer-owned items.
Define receivables, payables, deposits, prepaid service, open assignments and complaint duties using the delivery guide. Keep recurring expenses, necessary investment and agreed closing delivery distinct. Use the seller evidence guide before price discussions. A scenario calculator applies inputs; it does not certify an appraisal or verify market bids.
Owner questions
Is the invented $900 service remainder guard-business SDE?
It deducts only specified costs; full annual financial and owner-coverage reconciliation remains necessary.
Do multi-year contracts guarantee a higher multiple?
Review actual earnings, customer terms, qualified coverage and relevant sold evidence.
Does billable-hour pricing establish lawful payroll?
Review actual worker hours, wages, overtime and applicable requirements with qualified advisors.
Sources and review scope
Source review completed . The sources below support the identified concepts or rules; they do not validate hypothetical amounts or a valuation of your business.
- DOL Fact Sheet 4: security-guard wage and hour guidance
July 2008 general federal guidance, actually read in the rendered agency page: coverage, non-exempt hours/records, multiple posts, travel between sites and overtime questions. Full current linked regulations, exemptions, state/local rules and government-contract wage requirements need separate professional review. No payroll calculation, current wage-rate schedule, classification ruling or business clearance supplied.
- SEC: non-GAAP financial measure interpretations
Staff interpretations last updated December 2022: recurring operating costs and distinguishing EBITDA from adjusted measures. SEC reporting context, not a universal private-sale rule or automatic acceptance of add-backs.
- Illinois IDFPR: security-profession licensing resources
Illinois regulator directory distinguishes private-security contractor, agency/branch, employee-registration, firearm-card and training resources. Actual company/person/work scope and proposed ownership change need regulator/advisor review. Full linked statutes, rules, applications and exemptions not reviewed; not universal eligibility, transfer approval, firearm authorization or operating instructions.
- SBA: closing or selling a business
Valuation approaches, sale agreements, assets and ownership transfer.
Confirm tax, legal, accounting and lending applications with the relevant professionals. Historical market observations describe the stated period and reported sample.
This is educational material. Industry figures and program rules can change; check the original sources and your advisors before applying them to a transaction. Calculator scenarios are not appraisals, lending decisions, or offers.
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