Appearently they did a study on how precise it is, "Comparison of Circumference-and Skinfold-Based Body Fat Estimation Equations", where they compared their formula with several other methods for body fat estimation, against a baseline set by hydrostatic weighting. I couldn't find the full text online (at least not for free), but the abstract is here:
Quote: "For men, the Navy equation was the best predictor of body fat determined by hydrostatic weighing."
So all you need to track your body fat is a measuring tape plus a pen and a pad. That's too much of an effort for me, though, so I use one of the web-based calculators, e.g.
