The idea that book value is insufficient to value a company is decades old. I remember learning about it during the first few weeks of business school. The aut

The idea that book value is insufficient to value a company is decades old. I remember learning about it during the first few weeks of business school. The author's statement that goodwill gets expensed immediately is incorrect, as can be verified by consulting any introductory accounting textbook. (The whole point of goodwill is to make sure that an acquisition doesn't have an immediate impact on today's reported income. So expensing goodwill immediately would defeat the purpose.) The chart showing how enterprise value is comprised of tangible and intangible assets confused me. There's nothing that says enterprise value (market value of the company's stock, plus debt) must equal the sum of intangible+tangible assets, and it's actually pretty unlikely.