Restructuring question: add back non-recurring legal and other professional fees to what?

iridescent007's picture
Rank: King Kong | banana points 1,085

Hi, sorry for the dumb question, but I'm really confused here. In a distressed situation, typically in the 3-statements, we "add back non-recurring legal and other professional expenses associated with the distressed sales process/restructuring process".

The question is, to what? to net income? I know that when people normalize EBITDA/calculate adjusted EBITDA you adjust for non-recurring charges right, but I don't think it's EBITDA here.

Assume those non-recurring expenses are cash expenses.

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Jul 31, 2018