Every owner makes different choices about how to run a business.
Adjustments made in the valuation process are intended to negate these differences and level the playing field. While these things may happen in the course of owning the business, they are not predictable and should not detract from a company's value. These types of assets are adjusted off the balance sheet as is any associated debt. On the income statement, earnings are increased by adding back depreciation, interest and any other expense that may be associated with the non-operating or excess asset. The most common normalizing adjustment is for owner's compensation.