Comments on: What Stinks About Sweat Equity http://upandrunning.bplans.com/2008/06/06/what-stinks-about-sweat-equity/ Start, Run, and Grow Your Business Fri, 17 Feb 2012 18:41:05 +0000 hourly 1 http://wordpress.org/?v=3.3 By: Kent Loftin http://upandrunning.bplans.com/2008/06/06/what-stinks-about-sweat-equity/#comment-6687 Kent Loftin Mon, 12 Dec 2011 15:31:38 +0000 http://upandrunning.entrepreneur.com/2008/06/06/what-stinks-about-sweat-equity/#comment-6687 I've read several of your articles on sweat equity. In our start up, we three owners have agreed on how to value our sweat equity and how to pay ourselves if we ever earn enough to do so. In the meantime, how should we show the acruing sweat equity on our books? Our accountant has advised we not show it is a debt or as deferred payroll for some of the reasons you list in your articles. However, we need to furnish certain financial documents to the US Small Business Administration and are in a quandary as to how to show our sweat equity. We don't want to put in our income statement--it seems it would make us look really bad plus it wouldn't match what our accountant has put in out tax returns. We would like to show the SBA how much we have contributed to make our company successful without lookiing like we have taken on huge debt (the sweat equity). Any suggestions? I’ve read several of your articles on sweat equity. In our start up, we three owners have agreed on how to value our sweat equity and how to pay ourselves if we ever earn enough to do so. In the meantime, how should we show the acruing sweat equity on our books? Our accountant has advised we not show it is a debt or as deferred payroll for some of the reasons you list in your articles. However, we need to furnish certain financial documents to the US Small Business Administration and are in a quandary as to how to show our sweat equity. We don’t want to put in our income statement–it seems it would make us look really bad plus it wouldn’t match what our accountant has put in out tax returns. We would like to show the SBA how much we have contributed to make our company successful without lookiing like we have taken on huge debt (the sweat equity). Any suggestions?

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