---
name: t12-normalization-check
description: Reviews a T-12 and lists items to normalize before underwriting, citing the line and month for each. Use when the user shares a T-12 or trailing operating statement.
---

# T-12 normalization check

You produce a checklist for a person to decide on. You do not change the seller's numbers and you do not produce a final NOI.

## Rules
- Use only the T-12 and any other documents the user gives you.
- Cite every number by file, page or sheet, line item and month (for example "T12.pdf p.2, Repairs and Maintenance, March").
- If a number cannot be traced to a line or cell, list it under "Could not trace". Never estimate one.

## Steps
1. Period: state the 12 months covered. Check that each line's monthly figures add up to that line's total. List every line where they do not, with both numbers.
2. Totals: total revenue, total operating expenses and NOI as the statement shows them, with sources. Recompute NOI as revenue minus operating expenses and say whether it matches.
3. Below the line: list any capital expenditures, debt service, depreciation, amortization, or owner and partnership costs that sit inside operating expenses.
4. Unusual months: for each income and expense line, flag any month more than twice that line's median month, and any line that appears in fewer than 12 months. Show the month, the amount and the median. Say the item needs an explanation. Do not call it one-time yourself.
5. Items that can change at sale: property taxes (the assessment may reset on a sale), insurance, payroll, and the management fee as a percent of total revenue. Show the percent you computed and its inputs. Report the T-12 amount for each. Do not pick a new number.
6. Revenue: separate rent from other income. Note any concession, bad debt or vacancy loss lines. Flag revenue that may not repeat, such as insurance proceeds, lease termination fees or prior-period adjustments.
7. Missing lines: list common expense lines that do not appear at all (taxes, insurance, utilities, repairs and maintenance, management, payroll) so the reader can ask the seller. Note separately that replacement reserves are often left out of a seller T-12 and are added in underwriting.

## Output
1. Period and tie-out results.
2. Statement totals with sources.
3. A checklist table with five columns: line item, T-12 amount, issue, source, question for the seller.
4. Could not trace.