Adding site earnings can overstate a portfolio when central costs sit elsewhere or projected savings omit the people and systems needed to run the group. Reconcile the included entities first, remove matched internal activity, then show integration assumptions separately.
Define the perimeter before adding the figures
List every included site and central entity, the common annual period and the operating earnings basis. Use the same exact labels in each row. Confirm where owner work, management, rent, insurance, software, administrative payroll and other shared costs sit. A central entity with no site revenue can still contain substantial operating costs. Record zero only when the review supports it; a blank amount means unknown.
The tool requires explicit acknowledgment that the perimeter and central costs are complete before producing combined earnings and scenarios. Known gross subtotals remain visible when coverage is incomplete. A checkbox is your declaration, not independent verification. Compare entity records with bank, payroll, vendor and management evidence in the authorized data room.
Reconcile entity earnings on one basis
Begin with the monthly P&L workbook when periods or seasonal exposure differ. Use the owner replacement labor plan to identify continuing work. If a site combines washing, detailing and quick-lube operations, use the mixed-service allocation case for its service mix before adding the site to this portfolio.
Here, operating earnings precede financing, income tax and capital expenditure. Signed revenue or cost credits require an explanation; negative entity earnings are allowed. These inputs are a decision worksheet rather than a GAAP consolidation. Professional accounting review may require additional entries, ownership analysis and reporting policies beyond this model.
Eliminate matching internal activity without inventing savings
Assign each internal transaction a unique ID, revenue entity, expense entity, equal amounts and both ledger references. Both counterparties must be in the included perimeter. The workbook rejects mismatched amounts and eliminations greater than the receiving ledger totals. An unresolved mismatch needs investigation, not a plug to make the group balance.
Group external revenue equals summed entity revenue less matched internal revenue. Group external costs equal summed entity costs less the same matching internal expense. Eliminating both sides changes presentation, not earnings. A fee paid outside the included group remains an external expense; it cannot be removed just because the buyer hopes to renegotiate it.
Mister Car Wash’s fiscal 2025 Form 10-K describes eliminating intercompany balances and transactions in its consolidated reporting and discusses acquisition and integration risks. That is a historical filing by one operator, not a small-business margin benchmark or a prediction of savings for your portfolio. Read the filed report.
Worked fictional portfolio bridge
| Entity | Revenue | Costs | Operating earnings |
|---|---|---|---|
| Site A | $1,200,000 | $900,000, including $40,000 internal fee | $300,000 |
| Site B | $900,000 | $760,000, including $30,000 internal fee | $140,000 |
| Central | $70,000 internal fees | $120,000 external costs | −$50,000 |
| Gross group | $2,170,000 | $1,780,000 | $390,000 |
| After $70,000 matched elimination | $2,100,000 | $1,710,000 | $390,000 |
Separate annual run rate from the first year
For each recurring change, enter its annual dollar amount, start month, unique base-cost reference, evidence, owner and status. Select assumptions explicitly. Already-realized changes are excluded because they belong in the baseline. The tool blocks selected savings that reuse the same base-cost reference; the reviewer must still check differently named references for overlapping economics.
Start months run from 1 to 13. Month 1 contributes twelve months, month 7 six months, and month 13 none in the first year. This is an explicit whole-month, level-annual-amount convention. It does not model daily timing, seasonality or a gradual operating ramp. One-time expensed integration costs are entered separately. Capital projects belong in a cash model rather than being silently expensed here.
The fictional group assumes $60,000 annual supplier savings and a $90,000 annual additional manager. Annual run-rate earnings are $390,000 + $60,000 − $90,000 = $360,000. Savings begin in month 7, giving $30,000 in year one; the manager begins in month 1. With $45,000 one-time integration expenses, first-year earnings are $390,000 + $30,000 − $90,000 − $45,000 = $285,000.
The no-savings run rate is $300,000. Delaying savings by another three months while keeping costs and one-time expenses unchanged produces $270,000 first-year earnings. These sensitivities expose the timing assumption; they are not probability-weighted forecasts or an endorsement of the selected changes.
Test what the integration plan would require
For procurement savings, identify the existing spend pool, contract, volume conditions, termination costs and implementation owner. For shared staffing, verify travel, opening hours, absence cover and service standards. For membership portability, confirm plan terms, software capabilities and billing evidence rather than assuming members can use every acquired site. Use the membership continuity workbook for that workstream.
Translate the selected operating case into funding requirements and monthly cash runway. Review each lease and capital project separately. The portfolio result does not include debt service, tax, replacement reserves or cash trapped in individual entities.
The blank CSV is a working evidence register; the fictional CSV labels every scope, entity, elimination and scenario input. Keep versioned assumptions with their supporting records and rerun the bridge when the perimeter, contract terms or integration schedule changes.
Download the blank evidence register
Download the fictional teaching case v1
Sources and scope
Official and original sources checked October 17, 2026. These sources support the identified rules and methods; they do not verify a particular business or property.
- SEC / Mister Car Wash — Fiscal 2025 Form 10-KHistorical one-operator intercompany and integration context, not a transaction or margin benchmark.
Continue your review
Verify the revenue · Normalize earnings · Model the cash flow