Capital Series: Mea Culpa
January 14th, 2010
Copyright © 2010 Integrated Profitability TM
On October 26, 2009 I started this series on “capital” and to date six posts have been made. And every one of them has in intrinsic definitional flaw:
“Capital” includes all sources of funds that may be accessed by a company
I have written each article to focus exclusively on the “owners’” portion of capital. Here’s the issue in a nutshell:
● Capital includes all sources of funds
● Capital includes loans as well as owner investments
● Loans are liabilities
● Capital includes both liabilities (loans) and equity (stock investments)
Unfortunately, in the six posts to date I did not make my focus explicit and, worse, I mis-used the word “capital.” A much better word, given the focus of this series, is “Equity” which is the owners’ investment, or stake, in the company.
I apologize for the mistake. And, make no mistake, it is a mistake. I will go back to every “Capital” post-to-date and make the wording accurate.
If every storm cloud has a silver lining, this episode confirms the importance of several characteristics “Integrated Profitability” strives for:
● Accuracy
● Trust, Honesty, Integrity
● Full Disclosure
● Responsibility
● Accountability
I sincerely apologize for this mistake.
Bill
William A. Stong
Email: william.a.stong@gmail.com
SBF&P # 49
Telephone: 925-202-6244
Copyright © 2010 Integrated Profitability TM
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