Here’s what goes into consolidating the world-famous Forbes 400 list of the richest people on earth

It’s not easy being rich but that ain’t news to anybody. But what is more onerous than being affluent is documenting the riches of the ultra-rich. Something that Forbes has mastered over time; they are after all in the 38th edition of the flagship Forbes 400 list. If you too thought that these lists were made in an office with a few people jostling documents and sipping coffees over a few days you do have it wrong. Truth is, it takes an army of people to make these lists possible. From what we have learned as many as 50 reporters and investigators from around 20 countries work in compiling the rankings. The list starts with 700 candidates and is narrowed down to 400 after Forbes reporters dig deep to uncover new details. There are specialized sites such as which can offer a wealth of information that may help you determine someone’s financial situation and net worth. But when it comes to the ultra-rich, things are different and that involves getting in touch with the Forbes 400 members and candidates in person or catch them over a call. Not just the candidates, even their employees, handlers, rivals, peers, and attorneys are questioned and probed; it is they who know it all right? When the fortunes are so boundless, it brings along thousands of SEC documents, court records, probate records, and news articles and not just for one person, for 400 of them! Not an easy job to track every move that a billionaire takes, the deals he negotiates, or the painting he buys or the land he sells, as well as the causes they donate to. All these are looked upon to reach a solid valuation of that person’s listed assets. The single most important task to compile the list is the correct valuation. Everything from stakes in public and private companies, real estate, cars, horses, yachts, art, cash in hand and bank, gold, and debt are all accounted for. Some require a sneak peek into their private balance sheets but not every billionaire is open to the idea. Valuation of their wealth is much easier when they invest in public companies such as Microsoft, Facebook, Amazon, etc.

To value private businesses, they pair revenue or profit estimates with prevailing price-to-sales or price-to-earnings ratios for similar public companies and apply a 10% discount or more in cases where information is scarce. While married couples who built fortunes and businesses together are included only if their combined net worth makes the $2.1 billion cutoffs, scattered family fortunes are eliminated. It is not only about the money they make, but generosity and self-made prowess are also key points considered by Forbes.

[Via: Forbes]

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With over 15 years of experience in luxury journalism, Neha Tandon Sharma is a notable senior writer at Luxurylaunches. Her expertise spans luxury yachts, high-end fashion, and celebrity culture. Beyond writing, her passion for fantasy series is evident. Beginning with articles on women-centric gadgets, she's now a leading voice in luxury, with a fondness for opulent superyachts. To date, her portfolio boasts more than 2 million words, often penned alongside a cappuccino.