The Sun.
London, England, 1866-11-02 00:00:00

NORTH BRITISH.

The committee of investigation appointed at the
meeting of this company on the 28th of September
have just issued their report. It states that the
company, as now constituted, was a combination
of numerous independent undertakings. Incorpo-
rated in the year 1844 with a main line 58 miles
in length, and an authorised share and loan
capital of £1,000,066, it now comprehended within
its system 781 miles open to traffic, 147 miles
authorised by Parliament, and partly under
construction, an authorised share and loan capital
of £22,210,713, and a gross annual revenue ex-
ceeding £1,250,000. The capital hitherto created
amounted to £15,414,625, the borrowing powers
amounted £5,799,507, the ordinary share capital
was £4,771,230, the participating preference (Edin-
burgh and Glasgow ordinary) capital entitled to a
minimum dividend of 41- per cent. was £2,422,485,
and the other preference stocks of the company re-
present £8,220,910,the priorities of which preference
and participating preference stocks were determined
by the Amalgamation Act of 1865. The lines leased
by the company were the Peebles, Port Carlisle,
Carlisle and Silloth, and Edinburgh and Bathgate,
and those worked by the company for payment of a
percentage on their gross traffic receipts were the
St. Andrew's, the Leslie, the Devon Valley, the
Berwickshire, and the Milngavie Railways. He had
satisfaction in reporting the assurance given by their
professional assistants that the borrowing powers of
the company had not been exceeded, but were at
the 31st of July last still available to the extent of
£95,551. They were also certified that the nominal
share capital of the company, so far as issued, was
not in excess of the amount authorised and received
by the company in respect of it. The capital ac-
count had been unduly increased by carrying to it,
directly as well indirectly, sums of large amount on
various accounts. With regard to the revenue, the
accountants had prepared an adjusted account for
the half-year ending 31st of July last, exhibiting
the charges that, according to correct practice and
the usage of other railway companies, should be
placed against revenue. The result was that, after
paying debenture interest due at Whitsunday last,
a free revenue of only £113,591 appeared available
for the payment of the preferential dividends, ac-
cording to their priority, amounting to £208,441.
The additicns to the expenditure entered in the ad-
justed revenue statement consisted of £17,752 roll-
ing stock, £23,558 wages from the 18th to the 31st
of July, £5,073 boilers to ferry steamer, £l,OOO
citadel station at Carlisle, £16,3C0 Parliamentary
expenses, and £22,758 interest on unproductive
works and bank balances, making together
£86,440. The accountants specify,butdo not include
in the expenditure, £39,022 on account of line
renewals. The committee had no hesitation in
expressing their opinion that the large and, iu the
case of two half-years, improper accumulation to
" suspense" of relaying expenditure could not
be justified, more particularly when it was noticed
that from 1858 to 1864 the ordinary requirements
of the line had either been imprudently overlooked
or insufficiently attended to. During those years
the total sum expended was £18,125, of which there
was charged against revenue during those five half-
years only £6,000. At July, 1864, the re-laying
could evidently no longer be postponed, and the
following amounts were actually expended, although
in July, 1865, and January, 1866, much more was
debited to the renewal account—January 31, 1865,
£19,594 ; July 31, 1865, £22,582 ; January 31,
1866, £45,227 ; and July 31, 1866, £49,3l4—to-
gether, £136,718. During those half-years there
was charged to revenue only £64,500, but it prac-
tically included £17,418 and £29,256 over debited,
I which was in reality ordinary maintenance, making
u 6,674 ; so that only £17,826, or less than £4,500
each half-year, had been actually paid out of re-
renewal suspense, venue.
eanbsoe7 sums do not include £22,342 of
and Glasgow cow
transferred from the Edinburgh
tion, forming pany's books at the amalgama-
g part of the £153,358 at the credit of
the general balancein accountiNiarh in July last. At the
gtheanterialls7
oeoeotisnhgould be '1865, it was arranged
line chargedrenewals
to revenue half-
yearly towards the
then in progress.
At that time the system embraced
way, while it now extended to
yi
lesro.e of i rail-
way,
ei ld-
r r47aBBnslt a miles3l nl
rolling stock had also been
had prepared a statement zoife £a1n7d,7J5.2
W.
T he
Guild)acc accountants (Messrs W. Macken-
the sums placed to capital or suspense accounts, in-
stead of to revenue, in the 7 half years ending Jan.
31 last. These consisted of amount carried to sur-
plus property, &c., £269,286, and to capital and
other accounts, £80,048, together £349,334 ; deduct
I balances prior to July 31, 1862, £45,198, making
ithe total amount short charged £304,136. This large
accumulation of revenue expenditure, not provided
for, and now disclosed for the first time, formed
one of the chief sources of the financial difficulties
in which the company was placed. The amounts
thus kept out of revenue expenditure had been paid
away in dividends not earned, and the deficiency
thus occasioned had necessarily been provided for
by advances from bankers and other temporary
temporary
loans, which swelled the present
An important item of the
company's obligations consisted ofprelimdiunraing preliminary and
e
parliamentary expenses incurred, which
last four years amounted to £260,027. O
sum £79,000 was still unpaid, £69,643carriedfthis
was
to preliminary and parliamentary expenses, and
£64,070 to construction. The amount incurred
during the last session of Parliament was about
£64,000, of which £32,600 was stated as the cost of
promoting unsuccessful and opposing rival schilmes.
Of the latter amount, the accountants, in, their ad-
justed revenue account for the last half-year, had
placed one-half, or £16,300, against revenue, which
the committee approved. They state that compli-
cated and elaborated exertions had been made to
conceal a large amount of expenditure under the
head of suspense accounts, consistinc, of ,4 line re-
newals," " line sus ,7
otherwise postponed expenditure,lense,ense," .
‘: s "surplus
locomotivepro p e property,"
':
suspenseaud , , account
contingent
oth •
count 18"63,
accounts were in a greater
more than ready and convenient
or a
lessn2 n'n'
Lidne‘ tgs. degree account."
epAennl el s
tethhiaeuesge-
which should properlyoutlets chreaavteedbeeton
provide
carried
againstf o r charges
re
venue. The present. and postponed
according to the report,
liabilities of the company,
amounted to £1,875,626, to meet which there were
£95,551 unexercised borrowing powers of the com-
pany, and the power to issue preference ,Erfoek and