@v587d/capital-generation 2.7.11 → 2.8.0

package/selected-skills/investment-skills/skills/buffett-investment-framework/references/{03-management-governance.md → 03-management-governance-M01-M04.md}

@@ -118,96 +118,3 @@ Abbreviated corroboration citations resolve in the [source key](00-source-key.md
 - **Corroboration:** EWB §I.E; OM1996; FL2025.
 
 <a id="m05"></a>
-
-### M05 — Test Culture and the Institutional Imperative Through Behavior
-
-- **Decision question:** Which behaviors does the organization repeatedly attract,
-  reward, normalize, and reproduce?
-- **Guidance:** Treat culture as a system expressed through hiring, incentives,
-  forecasts, costs, imitation, and reactions to mistakes—not declared values.
-- **Use when:** A thesis depends on durable organizational behavior, acquisition
-  appetite, cost discipline, forecasting, or decentralization.
-- **Analytical actions:** Identify repeated behaviors; trace reinforcing mechanisms;
-  search for actions contradicting the declared culture.
-- **Output:** A culture-mechanism map with reinforcing behaviors, contradictions, and
-  change indicators.
-- **Limits:** Culture is neither automatic nor irreversible; leave durability unresolved
-  when evidence is anecdotal or leader dependent.
-- **Source basis:**
-  - **Berkshire Hathaway 1989 annual letter** — *defines*: institutional imperative.
-  - **Berkshire Hathaway 2000 annual letter** — *supports*: long term growth forecasts
-    can corrupt managerial behavior.
-- **Corroboration:** EWB §II.F; BH2002; BH2014.
-
-<a id="m06"></a>
-
-### M06 — Assess Decentralization, Controls, and Bad-News Flow
-
-- **Decision question:** Does authority sit with capable operators while audit,
-  compliance, escalation, and capital control remain effective?
-- **Guidance:** Evaluate autonomy and control together; decentralization requires
-  capable managers, protected escalation, and explicit retained controls.
-- **Use when:** Decentralized groups, holding companies, autonomous subsidiaries, or
-  multilayer information flow.
-- **Analytical actions:** Map delegated and retained authorities; test audit,
-  compliance, whistleblower, and bad-news channels; review detection and correction of
-  errors.
-- **Output:** An authority-and-control matrix with escalation paths, failure examples,
-  and unresolved dependencies.
-- **Limits:** Centralization can also fail and visible mistakes may be an accepted cost;
-  absent incident evidence leaves control quality unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 1991 annual letter** — *implements*: decentralize operations
-    centralize capital allocation.
-  - **Berkshire Hathaway 2004 annual letter** — *qualifies*: decentralized companies
-    need protected whistleblower channel.
-- **Corroboration:** CM50-2015; OM1996; LOW ch.15 (two-level control structure).
-
-<a id="m07"></a>
-
-### M07 — Test Substantive Board Independence and Power
-
-- **Decision question:** Can the board understand, challenge, and act against management
-  when owner interests require it?
-- **Guidance:** Judge independence by competence, economic independence, information,
-  deliberation, and willingness to oppose or replace management—not formal labels.
-- **Use when:** Board oversight, CEO power, deals, compensation, conflicts, or
-  controlling ownership affects the thesis.
-- **Analytical actions:** Map skills, ties, information, and voting power; inspect
-  dissent mechanisms; review behavior during conflicts or underperformance.
-- **Output:** A board-power assessment separating formal status from demonstrated
-  capability and action.
-- **Limits:** Ownership and private sessions do not create judgment; unobservable
-  conflict behavior leaves independence unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 2003 annual letter** — *supports*: business savvy is
-    indispensable for corporate directors.
-  - **Berkshire Hathaway 2019 annual letter** — *implements*: boards should hear
-    informed opposition to acquisitions.
-- **Corroboration:** EWB §I.B; BH2014; FL2025.
-
-<a id="m08"></a>
-
-### M08 — Assess Role-Specific Succession and Control Continuity
-
-- **Decision question:** Can leadership, operating, investment, and control roles
-  transfer without losing capability or fair treatment?
-- **Guidance:** Assess succession by role, horizon, emergency readiness, delegated
-  experience, and control-transfer mechanics; a name is not proof.
-- **Use when:** Key-person dependence, controlling ownership, aging leadership, estate
-  plans, voting arrangements, or role concentration.
-- **Analytical actions:** Separate role successions; inspect emergency and long-term
-  plans and staged responsibility; map voting, estate, and sale mechanics.
-- **Output:** A role-specific continuity map with successor evidence, control
-  transitions, triggers, and unresolved dependencies.
-- **Limits:** Private plans may remain undisclosed and legal or tax mechanics can
-  change; names or assurances alone leave readiness unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 2005 annual letter** — *defines*: succession role separation.
-  - **Berkshire Hathaway 2010 annual letter** — *implements*: document emergency
-    successors with strengths and weaknesses.
-- **Corroboration:** CM50-2015; BH2014; FL2025.
-
-<!-- This document follows common-doc-guidelines.md.
-See github.com/jlevy/practical-prose and review guidelines before editing.
--->

package/selected-skills/investment-skills/skills/buffett-investment-framework/references/03-management-governance-M05-M08.md

@@ -0,0 +1,97 @@
+# Management, Governance, and Culture · Part 2 of 2 (M05-M08)
+
+Cards M05, M06, M07, M08 of this module. Part 1 (`03-management-governance-M01-M04.md`) holds the module title and card index.
+Each part is sized to arrive complete in one `read`; open the part you need before concluding a card is absent.
+
+### M05 — Test Culture and the Institutional Imperative Through Behavior
+
+- **Decision question:** Which behaviors does the organization repeatedly attract,
+  reward, normalize, and reproduce?
+- **Guidance:** Treat culture as a system expressed through hiring, incentives,
+  forecasts, costs, imitation, and reactions to mistakes—not declared values.
+- **Use when:** A thesis depends on durable organizational behavior, acquisition
+  appetite, cost discipline, forecasting, or decentralization.
+- **Analytical actions:** Identify repeated behaviors; trace reinforcing mechanisms;
+  search for actions contradicting the declared culture.
+- **Output:** A culture-mechanism map with reinforcing behaviors, contradictions, and
+  change indicators.
+- **Limits:** Culture is neither automatic nor irreversible; leave durability unresolved
+  when evidence is anecdotal or leader dependent.
+- **Source basis:**
+  - **Berkshire Hathaway 1989 annual letter** — *defines*: institutional imperative.
+  - **Berkshire Hathaway 2000 annual letter** — *supports*: long term growth forecasts
+    can corrupt managerial behavior.
+- **Corroboration:** EWB §II.F; BH2002; BH2014.
+
+<a id="m06"></a>
+
+### M06 — Assess Decentralization, Controls, and Bad-News Flow
+
+- **Decision question:** Does authority sit with capable operators while audit,
+  compliance, escalation, and capital control remain effective?
+- **Guidance:** Evaluate autonomy and control together; decentralization requires
+  capable managers, protected escalation, and explicit retained controls.
+- **Use when:** Decentralized groups, holding companies, autonomous subsidiaries, or
+  multilayer information flow.
+- **Analytical actions:** Map delegated and retained authorities; test audit,
+  compliance, whistleblower, and bad-news channels; review detection and correction of
+  errors.
+- **Output:** An authority-and-control matrix with escalation paths, failure examples,
+  and unresolved dependencies.
+- **Limits:** Centralization can also fail and visible mistakes may be an accepted cost;
+  absent incident evidence leaves control quality unresolved.
+- **Source basis:**
+  - **Berkshire Hathaway 1991 annual letter** — *implements*: decentralize operations
+    centralize capital allocation.
+  - **Berkshire Hathaway 2004 annual letter** — *qualifies*: decentralized companies
+    need protected whistleblower channel.
+- **Corroboration:** CM50-2015; OM1996; LOW ch.15 (two-level control structure).
+
+<a id="m07"></a>
+
+### M07 — Test Substantive Board Independence and Power
+
+- **Decision question:** Can the board understand, challenge, and act against management
+  when owner interests require it?
+- **Guidance:** Judge independence by competence, economic independence, information,
+  deliberation, and willingness to oppose or replace management—not formal labels.
+- **Use when:** Board oversight, CEO power, deals, compensation, conflicts, or
+  controlling ownership affects the thesis.
+- **Analytical actions:** Map skills, ties, information, and voting power; inspect
+  dissent mechanisms; review behavior during conflicts or underperformance.
+- **Output:** A board-power assessment separating formal status from demonstrated
+  capability and action.
+- **Limits:** Ownership and private sessions do not create judgment; unobservable
+  conflict behavior leaves independence unresolved.
+- **Source basis:**
+  - **Berkshire Hathaway 2003 annual letter** — *supports*: business savvy is
+    indispensable for corporate directors.
+  - **Berkshire Hathaway 2019 annual letter** — *implements*: boards should hear
+    informed opposition to acquisitions.
+- **Corroboration:** EWB §I.B; BH2014; FL2025.
+
+<a id="m08"></a>
+
+### M08 — Assess Role-Specific Succession and Control Continuity
+
+- **Decision question:** Can leadership, operating, investment, and control roles
+  transfer without losing capability or fair treatment?
+- **Guidance:** Assess succession by role, horizon, emergency readiness, delegated
+  experience, and control-transfer mechanics; a name is not proof.
+- **Use when:** Key-person dependence, controlling ownership, aging leadership, estate
+  plans, voting arrangements, or role concentration.
+- **Analytical actions:** Separate role successions; inspect emergency and long-term
+  plans and staged responsibility; map voting, estate, and sale mechanics.
+- **Output:** A role-specific continuity map with successor evidence, control
+  transitions, triggers, and unresolved dependencies.
+- **Limits:** Private plans may remain undisclosed and legal or tax mechanics can
+  change; names or assurances alone leave readiness unresolved.
+- **Source basis:**
+  - **Berkshire Hathaway 2005 annual letter** — *defines*: succession role separation.
+  - **Berkshire Hathaway 2010 annual letter** — *implements*: document emergency
+    successors with strengths and weaknesses.
+- **Corroboration:** CM50-2015; BH2014; FL2025.
+
+<!-- This document follows common-doc-guidelines.md.
+See github.com/jlevy/practical-prose and review guidelines before editing.
+-->

package/selected-skills/investment-skills/skills/buffett-investment-framework/references/04-financial-reality-F01-F03.md

@@ -0,0 +1,95 @@
+# Financial Reality and Owner Economics
+
+Use these cards as evidence-bounded analytical prompts derived from Buffett and
+Berkshire writings. Apply them to supplied evidence, preserve each card’s limits, and
+return unresolved findings when prerequisites are missing.
+
+Read this file when reconciling filings, owner earnings, segments, capital returns, or
+obligations. Load only the cards selected by the router; do not load the whole module by
+default. Abbreviated corroboration citations resolve in the
+[source key](00-source-key.md).
+
+## Card Index
+
+| Card | Decision question |
+| --- | --- |
+| [F01](#f01) | What ownership, cash-flow, and obligation economics lie behind the reported result? |
+| [F02](#f02) | How much cash can owners remove without weakening competitive position or unit volume? |
+| [F03](#f03) | Which capital preserves economics, funds growth, remains trapped, or is actually distributable? |
+| [F04](#f04) | What economics accrue through minority interests, segments, and holding structures despite reported presentation? |
+| [F05](#f05) | What recurring earning power belongs to each distinct business across a representative period? |
+| [F06](#f06) | What normalized unleveraged returns does the business earn on required tangible capital, and what has additional capital produced? |
+| [F07](#f07) | What disclosed or implied claims could absorb cash materially beyond reported earnings or liabilities? |
+
+## Complete Cards
+
+<a id="f01"></a>
+
+### F01 — Reconstruct Economic Substance from Accounting
+
+- **Decision question:** What ownership, cash-flow, and obligation economics lie behind
+  the reported result?
+- **Guidance:** Begin with audited figures and reconcile every adjustment back to them;
+  accounting rules are inputs, not permission to discard costs.
+- **Use when:** Accounting form, rule changes, acquisition accounting, noncash charges,
+  consolidation, or management metrics may obscure economics.
+- **Analytical actions:** Inventory policies and changes; reconcile totals to the
+  analytical view; explain the economic reason for every adjustment.
+- **Output:** A reported-to-economic bridge with source, amount, rationale, and
+  unresolved items for each adjustment.
+- **Limits:** Adjustments can introduce bias and false precision; unsupported
+  substitutions or an unreconciled bridge remain unresolved.
+- **Source basis:**
+  - **Berkshire Hathaway 1982 annual letter** — *supports*: accounting numbers begin not
+    end valuation.
+  - **Berkshire Hathaway 2001 annual letter** — *illustrates*: goodwill rule change
+    raises reported not economic earnings.
+- **Corroboration:** EWB §V.B; EWB §V.D; OM1996; BH2014.
+
+<a id="f02"></a>
+
+### F02 — Estimate Owner Earnings After All Real Costs
+
+- **Decision question:** How much cash can owners remove without weakening competitive
+  position or unit volume?
+- **Guidance:** Restore noncash charges only when they are not economic depletion and
+  subtract maintenance capital, required working capital, compensation, and recurring
+  costs; use supported ranges.
+- **Use when:** Cash removability or distributable earning power matters to valuation,
+  reinvestment, or payout analysis.
+- **Analytical actions:** Show every adjustment; estimate maintenance capital and
+  working capital across a representative period; sensitize judgmental components.
+- **Output:** A reconciled owner-earnings range with assumptions, sensitivities, and
+  blocked components.
+- **Limits:** Maintenance and growth overlap and depreciation or amortization may
+  misstate depletion; unbounded material needs leave the result unresolved.
+- **Source basis:**
+  - **Berkshire Hathaway 1986 annual letter** — *defines*: owner earnings.
+  - **Berkshire Hathaway 2000 annual letter** — *supports*: depreciation represents real
+    maintenance capital cost.
+- **Corroboration:** EWB §V.D; BH2002; BH2014; BH2023.
+
+<a id="f03"></a>
+
+### F03 — Separate Maintenance, Growth, Restricted, and Distributable Capital
+
+- **Decision question:** Which capital preserves economics, funds growth, remains
+  trapped, or is actually distributable?
+- **Guidance:** Classify capital by economic function before treating cash flow as owner
+  value; required, catch-up, restricted, or low-return reinvestment is not freely
+  distributable.
+- **Use when:** Capital-intensive, regulated, cyclical, rapidly growing, or structurally
+  restricted businesses.
+- **Analytical actions:** Classify spending and working capital; reconcile restrictions
+  and reserves; test whether claimed growth spending only preserves economics.
+- **Output:** A schedule of maintenance, growth, catch-up, restricted, and distributable
+  amounts or ranges.
+- **Limits:** Categories overlap and management labels may be unreliable; unbounded
+  maintenance or restrictions leave distributability unresolved.
+- **Source basis:**
+  - **Berkshire Hathaway 1986 annual letter** — *defines*: owner earnings.
+  - **Berkshire Hathaway 2007 annual letter** — *qualifies*: rapid growth low return
+    capital hunger is worst business model.
+- **Corroboration:** EWB §V.C; OM1996; BH2023.
+
+<a id="f04"></a>

package/selected-skills/investment-skills/skills/buffett-investment-framework/references/{04-financial-reality.md → 04-financial-reality-F04-F07.md}

@@ -1,98 +1,7 @@
-# Financial Reality and Owner Economics
+# Financial Reality and Owner Economics · Part 2 of 2 (F04-F07)
 
-Use these cards as evidence-bounded analytical prompts derived from Buffett and
-Berkshire writings. Apply them to supplied evidence, preserve each card’s limits, and
-return unresolved findings when prerequisites are missing.
-
-Read this file when reconciling filings, owner earnings, segments, capital returns, or
-obligations. Load only the cards selected by the router; do not load the whole module by
-default. Abbreviated corroboration citations resolve in the
-[source key](00-source-key.md).
-
-## Card Index
-
-| Card | Decision question |
-| --- | --- |
-| [F01](#f01) | What ownership, cash-flow, and obligation economics lie behind the reported result? |
-| [F02](#f02) | How much cash can owners remove without weakening competitive position or unit volume? |
-| [F03](#f03) | Which capital preserves economics, funds growth, remains trapped, or is actually distributable? |
-| [F04](#f04) | What economics accrue through minority interests, segments, and holding structures despite reported presentation? |
-| [F05](#f05) | What recurring earning power belongs to each distinct business across a representative period? |
-| [F06](#f06) | What normalized unleveraged returns does the business earn on required tangible capital, and what has additional capital produced? |
-| [F07](#f07) | What disclosed or implied claims could absorb cash materially beyond reported earnings or liabilities? |
-
-## Complete Cards
-
-<a id="f01"></a>
-
-### F01 — Reconstruct Economic Substance from Accounting
-
-- **Decision question:** What ownership, cash-flow, and obligation economics lie behind
-  the reported result?
-- **Guidance:** Begin with audited figures and reconcile every adjustment back to them;
-  accounting rules are inputs, not permission to discard costs.
-- **Use when:** Accounting form, rule changes, acquisition accounting, noncash charges,
-  consolidation, or management metrics may obscure economics.
-- **Analytical actions:** Inventory policies and changes; reconcile totals to the
-  analytical view; explain the economic reason for every adjustment.
-- **Output:** A reported-to-economic bridge with source, amount, rationale, and
-  unresolved items for each adjustment.
-- **Limits:** Adjustments can introduce bias and false precision; unsupported
-  substitutions or an unreconciled bridge remain unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 1982 annual letter** — *supports*: accounting numbers begin not
-    end valuation.
-  - **Berkshire Hathaway 2001 annual letter** — *illustrates*: goodwill rule change
-    raises reported not economic earnings.
-- **Corroboration:** EWB §V.B; EWB §V.D; OM1996; BH2014.
-
-<a id="f02"></a>
-
-### F02 — Estimate Owner Earnings After All Real Costs
-
-- **Decision question:** How much cash can owners remove without weakening competitive
-  position or unit volume?
-- **Guidance:** Restore noncash charges only when they are not economic depletion and
-  subtract maintenance capital, required working capital, compensation, and recurring
-  costs; use supported ranges.
-- **Use when:** Cash removability or distributable earning power matters to valuation,
-  reinvestment, or payout analysis.
-- **Analytical actions:** Show every adjustment; estimate maintenance capital and
-  working capital across a representative period; sensitize judgmental components.
-- **Output:** A reconciled owner-earnings range with assumptions, sensitivities, and
-  blocked components.
-- **Limits:** Maintenance and growth overlap and depreciation or amortization may
-  misstate depletion; unbounded material needs leave the result unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 1986 annual letter** — *defines*: owner earnings.
-  - **Berkshire Hathaway 2000 annual letter** — *supports*: depreciation represents real
-    maintenance capital cost.
-- **Corroboration:** EWB §V.D; BH2002; BH2014; BH2023.
-
-<a id="f03"></a>
-
-### F03 — Separate Maintenance, Growth, Restricted, and Distributable Capital
-
-- **Decision question:** Which capital preserves economics, funds growth, remains
-  trapped, or is actually distributable?
-- **Guidance:** Classify capital by economic function before treating cash flow as owner
-  value; required, catch-up, restricted, or low-return reinvestment is not freely
-  distributable.
-- **Use when:** Capital-intensive, regulated, cyclical, rapidly growing, or structurally
-  restricted businesses.
-- **Analytical actions:** Classify spending and working capital; reconcile restrictions
-  and reserves; test whether claimed growth spending only preserves economics.
-- **Output:** A schedule of maintenance, growth, catch-up, restricted, and distributable
-  amounts or ranges.
-- **Limits:** Categories overlap and management labels may be unreliable; unbounded
-  maintenance or restrictions leave distributability unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 1986 annual letter** — *defines*: owner earnings.
-  - **Berkshire Hathaway 2007 annual letter** — *qualifies*: rapid growth low return
-    capital hunger is worst business model.
-- **Corroboration:** EWB §V.C; OM1996; BH2023.
-
-<a id="f04"></a>
+Cards F04, F05, F06, F07 of this module. Part 1 (`04-financial-reality-F01-F03.md`) holds the module title and card index.
+Each part is sized to arrive complete in one `read`; open the part you need before concluding a card is absent.
 
 ### F04 — Look Through Partial Ownership, Segments, and Holding Structures
 

package/selected-skills/investment-skills/skills/buffett-investment-framework/references/{05-valuation.md → 05-valuation-V01-V03.md}

@@ -92,75 +92,3 @@ Abbreviated corroboration citations resolve in the [source key](00-source-key.md
 - **Corroboration:** EWB §V.B; BH2002; BH2023.
 
 <a id="v04"></a>
-
-### V04 — Value Growth Only Through Incremental Capital Economics
-
-- **Decision question:** Does projected growth increase future owner cash after funding
-  its capital requirements?
-- **Guidance:** Credit growth only through supported changes in owner cash and
-  incremental returns; reduce expectations for capital hunger or return decay.
-- **Use when:** Growth contributes materially to valuation or thesis.
-- **Analytical actions:** Reconcile growth with incremental capital and owner cash;
-  compare returns with opportunity cost; sensitize scale, runway, and funding.
-- **Output:** A growth-value bridge separating revenue growth, required capital,
-  incremental return, and owner-cash contribution.
-- **Limits:** Future returns are unobserved; unbounded funding or incremental returns
-  leave growth value unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 1992 annual letter** — *supports*: growth creates value only
-    above cost of incremental capital.
-  - **Berkshire Hathaway 2000 annual letter** — *supports*: growth affects value only
-    through cash flow economics.
-- **Corroboration:** EWB §II.D; EWB §III.C; CM50-2015; LOW ch.10 (cable-TV rejection
-  case).
-
-<a id="v05"></a>
-
-### V05 — Expose Assumptions, Sensitivities, and Missing Evidence
-
-- **Decision question:** Which assumptions drive the range, how fragile are they, and
-  which missing facts block a conclusion?
-- **Guidance:** Make operating, reinvestment, discounting, and terminal assumptions
-  explicit; test plausible combinations and identify invalidating evidence.
-- **Use when:** Every material valuation, especially when forecast or model dependence
-  is high.
-- **Analytical actions:** Rank drivers by impact and uncertainty; run supported scenario
-  combinations; map each missing input to the blocked conclusion.
-- **Output:** A sensitivity and missing-evidence register tied to the value range and
-  invalidation conditions.
-- **Limits:** Sensitivity cannot validate bad assumptions or assign unsupported
-  probabilities; unsupported bounds require no value conclusion.
-- **Source basis:**
-  - **Berkshire Hathaway 1999 annual letter** — *implements*: estimate intrinsic value
-    as a range.
-  - **Berkshire Hathaway 2020 annual letter** — *illustrates*: Precision Castparts
-    overpayment from earnings overestimate.
-- **Corroboration:** EWB §II.D; BH2002; BH2014.
-
-<a id="v06"></a>
-
-### V06 — Require a Margin of Safety Proportionate to Uncertainty
-
-- **Decision question:** Is the price-value gap adequate for uncertainty, resilience,
-  financing, and downside shown by the evidence?
-- **Guidance:** Compare price with the conservative end of a supported range and require
-  more room for greater uncertainty; a discount cannot cure fragility.
-- **Use when:** A defensible value range and downside analysis exist and price is in
-  scope.
-- **Analytical actions:** Quantify scenario gaps; tie required room to named
-  uncertainty; test whether the discount survives adverse assumptions.
-- **Output:** A price-value table with scenario gaps, uncertainty drivers, and an
-  adequate, inadequate, or unresolved analytical finding.
-- **Limits:** No universal discount applies; missing price or value leaves the result
-  unresolved, and the finding is not trade authority.
-- **Source basis:**
-  - **Warren Buffett’s 1984 essay “The Superinvestors of Graham-and-Doddsville”** —
-    *defines*: margin of safety.
-  - **Berkshire Hathaway 2020 annual letter** — *illustrates*: Precision Castparts
-    overpayment from earnings overestimate.
-- **Corroboration:** EWB §II.D; BH2025; LOW ch.5 (franchise-value margin evolution); LOW
-  ch.8 (Washington Post discount case).
-
-<!-- This document follows common-doc-guidelines.md.
-See github.com/jlevy/practical-prose and review guidelines before editing.
--->

package/selected-skills/investment-skills/skills/buffett-investment-framework/references/05-valuation-V04-V06.md

@@ -0,0 +1,76 @@
+# Valuation and Price Discipline · Part 2 of 2 (V04-V06)
+
+Cards V04, V05, V06 of this module. Part 1 (`05-valuation-V01-V03.md`) holds the module title and card index.
+Each part is sized to arrive complete in one `read`; open the part you need before concluding a card is absent.
+
+### V04 — Value Growth Only Through Incremental Capital Economics
+
+- **Decision question:** Does projected growth increase future owner cash after funding
+  its capital requirements?
+- **Guidance:** Credit growth only through supported changes in owner cash and
+  incremental returns; reduce expectations for capital hunger or return decay.
+- **Use when:** Growth contributes materially to valuation or thesis.
+- **Analytical actions:** Reconcile growth with incremental capital and owner cash;
+  compare returns with opportunity cost; sensitize scale, runway, and funding.
+- **Output:** A growth-value bridge separating revenue growth, required capital,
+  incremental return, and owner-cash contribution.
+- **Limits:** Future returns are unobserved; unbounded funding or incremental returns
+  leave growth value unresolved.
+- **Source basis:**
+  - **Berkshire Hathaway 1992 annual letter** — *supports*: growth creates value only
+    above cost of incremental capital.
+  - **Berkshire Hathaway 2000 annual letter** — *supports*: growth affects value only
+    through cash flow economics.
+- **Corroboration:** EWB §II.D; EWB §III.C; CM50-2015; LOW ch.10 (cable-TV rejection
+  case).
+
+<a id="v05"></a>
+
+### V05 — Expose Assumptions, Sensitivities, and Missing Evidence
+
+- **Decision question:** Which assumptions drive the range, how fragile are they, and
+  which missing facts block a conclusion?
+- **Guidance:** Make operating, reinvestment, discounting, and terminal assumptions
+  explicit; test plausible combinations and identify invalidating evidence.
+- **Use when:** Every material valuation, especially when forecast or model dependence
+  is high.
+- **Analytical actions:** Rank drivers by impact and uncertainty; run supported scenario
+  combinations; map each missing input to the blocked conclusion.
+- **Output:** A sensitivity and missing-evidence register tied to the value range and
+  invalidation conditions.
+- **Limits:** Sensitivity cannot validate bad assumptions or assign unsupported
+  probabilities; unsupported bounds require no value conclusion.
+- **Source basis:**
+  - **Berkshire Hathaway 1999 annual letter** — *implements*: estimate intrinsic value
+    as a range.
+  - **Berkshire Hathaway 2020 annual letter** — *illustrates*: Precision Castparts
+    overpayment from earnings overestimate.
+- **Corroboration:** EWB §II.D; BH2002; BH2014.
+
+<a id="v06"></a>
+
+### V06 — Require a Margin of Safety Proportionate to Uncertainty
+
+- **Decision question:** Is the price-value gap adequate for uncertainty, resilience,
+  financing, and downside shown by the evidence?
+- **Guidance:** Compare price with the conservative end of a supported range and require
+  more room for greater uncertainty; a discount cannot cure fragility.
+- **Use when:** A defensible value range and downside analysis exist and price is in
+  scope.
+- **Analytical actions:** Quantify scenario gaps; tie required room to named
+  uncertainty; test whether the discount survives adverse assumptions.
+- **Output:** A price-value table with scenario gaps, uncertainty drivers, and an
+  adequate, inadequate, or unresolved analytical finding.
+- **Limits:** No universal discount applies; missing price or value leaves the result
+  unresolved, and the finding is not trade authority.
+- **Source basis:**
+  - **Warren Buffett’s 1984 essay “The Superinvestors of Graham-and-Doddsville”** —
+    *defines*: margin of safety.
+  - **Berkshire Hathaway 2020 annual letter** — *illustrates*: Precision Castparts
+    overpayment from earnings overestimate.
+- **Corroboration:** EWB §II.D; BH2025; LOW ch.5 (franchise-value margin evolution); LOW
+  ch.8 (Washington Post discount case).
+
+<!-- This document follows common-doc-guidelines.md.
+See github.com/jlevy/practical-prose and review guidelines before editing.
+-->

package/selected-skills/investment-skills/skills/buffett-investment-framework/references/{06-capital-allocation.md → 06-capital-allocation-C01-C04.md}

@@ -121,118 +121,3 @@ Abbreviated corroboration citations resolve in the [source key](00-source-key.md
 - **Corroboration:** EWB §III.C; OM1996; BH2014; LOW ch.15 (subsidiary retention test).
 
 <a id="c05"></a>
-
-### C05 — Return Surplus Capital When No Better Use Exists
-
-- **Decision question:** After protected reserves and productive uses, is capital
-  genuinely surplus?
-- **Guidance:** Treat payout as the consequence of no better supported deployment, not a
-  fixed preference; distinguish distribution from central redeployment.
-- **Use when:** Mature or capital-light operations generate cash beyond maintenance,
-  growth, obligations, and resilience needs.
-- **Analytical actions:** Reconcile distributable cash after C02; compare C03
-  alternatives; show tax, control, and owner-treatment effects of payout channels.
-- **Output:** A surplus-capital ledger with amounts blocked, deployable, distributable,
-  or unresolved.
-- **Limits:** Legal, tax, contractual, and balance-sheet limits may block payout; an
-  incomplete reserve or opportunity set means no surplus finding.
-- **Source basis:**
-  - **Berkshire Hathaway 1984 annual letter** — *implements*: Berkshire dividend policy
-    uses value creation threshold.
-  - **Berkshire Hathaway 2007 annual letter** — *qualifies*: redeploy cash from high
-    return low reinvestment businesses.
-- **Corroboration:** EWB §III.C; BH2014; LOW ch.15 (distribution threshold case).
-
-<a id="c06"></a>
-
-### C06 — Repurchase Only Below Value with Surplus Capacity and Material Effect
-
-- **Decision question:** Will repurchase materially improve continuing-owner value
-  without weakening resilience or unfairly transferring value?
-- **Guidance:** Require conservative undervaluation, protected liquidity, fair
-  disclosure, superior alternatives, and meaningful per-share effect.
-- **Use when:** An issuer proposes, conducts, or defends a material repurchase.
-- **Analytical actions:** Compare price with value; recheck capacity and alternatives;
-  quantify shares retired, financing, per-share effect, and transfers.
-- **Output:** A repurchase worksheet with value, capacity, materiality, fairness,
-  alternatives, and unresolved assumptions.
-- **Limits:** Value is uncertain and above-value purchases can transfer wealth; the
-  worksheet authorizes no repurchase or trade.
-- **Source basis:**
-  - **Berkshire Hathaway 1980 annual letter** — *implements*: repurchase below intrinsic
-    value.
-  - **Berkshire Hathaway 1999 annual letter** — *qualifies*: above value repurchases
-    transfer wealth from continuing owners.
-- **Corroboration:** EWB §IV.B; BH2014; BH2022; LOW ch.10 (Washington Post repurchases).
-
-<a id="c07"></a>
-
-### C07 — Issue Shares Only Value for Value
-
-- **Decision question:** Does issuing equity give owners at least as much durable value
-  and resilience as the interest surrendered?
-- **Guidance:** Analyze issuance as a partial sale of owner assets and compare value
-  surrendered with assets, claims extinguished, or resilience received.
-- **Use when:** Stock-financed acquisitions, compensation issuance, conversion,
-  recapitalization, or balance-sheet repair.
-- **Analytical actions:** Estimate value and ownership surrendered; value consideration
-  and resilience received; reconcile to continuing-owner value rather than optics.
-- **Output:** An issuance exchange bridge with ownership transfer, proceeds, financing
-  effects, and per-share result.
-- **Limits:** Issuance can rationally improve resilience and both sides are uncertain;
-  missing estimates leave the exchange unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 1982 annual letter** — *implements*: share issuance value for
-    value rule.
-  - **Berkshire Hathaway 1992 annual letter** — *illustrates*: stock financed bank deal
-    destroyed value.
-- **Corroboration:** EWB §IV.A; OM1996; LOW ch.12 (stock-deal dilution cases).
-
-<a id="c08"></a>
-
-### C08 — Evaluate Acquisitions by Quality, Price, Financing, Alternatives, and Postmortems
-
-- **Decision question:** Does the complete exchange improve continuing-owner value under
-  defensible stand-alone and downside cases?
-- **Guidance:** Evaluate target economics, management, price, financing, dilution,
-  alternatives, and realized outcomes together, not EPS or size.
-- **Use when:** A proposed or completed acquisition, merger, or major asset purchase.
-- **Analytical actions:** Underwrite stand-alone quality and owner cash; build a value
-  exchange and financing bridge; preserve assumptions for post-closing comparison.
-- **Output:** An acquisition sheet with stand-alone value, consideration, financing,
-  alternatives, downside, per-share effect, and postmortem fields.
-- **Limits:** Good businesses can be overpaid for and synergies may matter; unbounded
-  economics or consideration leaves the assessment unresolved.
-- **Source basis:**
-  - **Berkshire Hathaway 1985 annual letter** — *implements*: Berkshire whole business
-    acquisition criteria.
-  - **Berkshire Hathaway 2017 annual letter** — *implements*: evaluate acquisitions on
-    all equity basis.
-- **Corroboration:** EWB §IV.D; OM1996; BH2014.
-
-<a id="c09"></a>
-
-### C09 — Counter Acquisition-Process Bias
-
-- **Decision question:** Has commitment manufactured confidence through selective
-  information, incentives, or optimistic assumptions?
-- **Guidance:** Require an informed opposing case challenging seller information,
-  forecasts, turnarounds, synergies, adviser incentives, and deal hunger.
-- **Use when:** A material transaction with committed leadership, seller-controlled
-  information, or synergy and turnaround dependence.
-- **Analytical actions:** Build the stand-alone downside before synergies; map
-  incentives and information; run a premortem and preserve assumptions.
-- **Output:** An independent deal-challenge memo listing contested assumptions,
-  adverse-selection risks, opposing evidence, and unresolved conditions.
-- **Limits:** Seller advantage does not imply fraud, deals do not universally fail, and
-  broad acquisition priors cannot determine a specific case.
-- **Source basis:**
-  - **Berkshire Hathaway 1995 annual letter** — *supports*: most acquisitions damage
-    buyers and seller projections mislead.
-  - **Berkshire Hathaway 2017 annual letter** — *supports*: deal hunger recruits biased
-    forecasts and synergies.
-- **Corroboration:** EWB §IV.A; EWB §IV.D; BH2014; LOW ch.12 (acquisition ego cases).
-
-<!-- This document follows common-doc-guidelines.md.
-See github.com/jlevy/practical-prose and review guidelines before editing.
--->