Quote:I dont think you understand the difference between a business' books and their tax return. The tax return usually allows more of a loss due to various credits and bonus depreciation.


Ya, if something fishy is on the return, then the irs will audit the business and look at their books. But ultimately the irs does not regulate bookkeeping.


What the jags have on their books is regulated by gaap, not the irs.


Point is, if the khan goes court to discuss his books, the irs is not involved. It would probably involve a financials audit by a firm.

 

If they are going to use their accounting as a legal basis for breaking a lease, ie like your claim that they could forward the depreciation expense from the renovations to show a loss, then their books better follow GAAP and proper tax accounting because you better believe they will be opened by court order and the IRS will be right there should the court finds the books have been cooked.

---