Glossary · Reading the business
In short
This is the expense a business incurs to meet regulations, laws, and industry standards. It can include fees, audits, and staff time, and directly impacts profitability.
During due diligence, identify all significant compliance requirements and their associated costs for the target business. These can range from environmental regulations to industry-specific licenses. Factor these non-discretionary expenses into your financial projections, as they are essential to operating legally and can't be "add-backed."
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
Pressure-test the numbers before you make an offer
Send us the asking price and the seller's cash flow — we'll show whether the deal services SBA debt and where the add-backs are likely to hold up.
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