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Usually, the more liquid is the asset, the higher the percentage realized The liquidation value of cash is always 100 percent (C6) It is common for receivables to lose some value in liquidation, since some customers who know the company is going out of business will take unfair advantage and not pay their bills This is a subjective estimate, as are almost all of the items in column C Note that leasehold improvements rarely have any liquidation value hence the zero percent (C11) The book value of Total Assets in our sample liquidation is $10,730,000 (B12), while we have estimated liquidation value of Total Assets to be $5,255,000 (D12) Liabilities typically carry their book value through, as the company or its owner must still pay what it owes If the company has a large loan at interest rates that are substantially different than current market rates, then the market value of the liability may be materially different than its remaining principal To value such debt, you will need to read 4 and perform a Discounted Cash Flow calculation on it It is necessary to estimate liquidation costs An orderly liquidation takes more time than a fire sale The liquidator s time is an opportunity cost, as are out-of-pocket expenses He or she could just abandon the business or do a fire sale and begin working elsewhere immediately In this example, we assume the owner will spend six months to liquidate the business If the appropriate arm s length salary is $100,000 per year, a six-month effort costs $50,000 and is an economic liability of the business We further assume it will cost $50,000 in out-of-pocket costs to liquidate the firm, for a total of $100,000 (D14) The total liquidation value liabilities are $400,000 (D13 D14) Subtracting that from assets of $5,255,000 (D12) leaves liquidation value capital of $4,855,000 (D15) The next step is to compare the value of the business dead and alive It is worth $4,855,000 dead (Table A22, D15) and $7,906,000 alive (Table A21, F23) Thus, the live value dominates, ie, Vaporware is worth more as a going concern than it is in liquidation This is true even though the book value of equity, $10,430,000 (Table A22, B15) is higher than the Guideline Public Company Method valuation.



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We have covered a tremendous range of possible attacks on Windows NT in this chapter, so many that most readers may be wondering aloud about the inherent security of the OS If so, then we haven t done our jobs let us reemphasize that little can be done remotely without the Administrator privilege, and that there are few ways to obtain this privilege other than the usual routes: guessing the password, eavesdropping on password exchanges, or social engineering it from gullible personnel Thus, our summary will be mercifully short after this long read If the following simple steps are taken, 9999 percent of Windows NT security problems just vanish Keep in mind, though, that the other 001 percent of problems probably haven t been thought up yet M Block access to TCP and UDP ports 135 139 This single step will prevent almost every remote NT problem we ve outlined in this book It should definitely be done at the perimeter security gateway for all networks and should be considered for internal access devices as well Individual hosts can have NetBIOS disabled on sensitive interfaces Scan your networks regularly for stragglers If you are running TCP/IP on NT, configure TCP/IP Filtering under Control Panel | Network | Protocols | TCP/IP | Advanced | Enable Security |





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