The Sun.
London, England, 1850-01-29 00:00:00

" REVENUE ACCOUNT.

" 1. Traffic.—The tail receipts for the half-yelr have
been 286,3581., showing an increase of 27,7551. over the
corresponding half-year of 1848, of which, however,
3,3851. is for cartage in collection and delivery cf goods,
which Lai been undertaken by the company since March,
1849, and therefore forms no feature of comparison. Ex-
cludiLg this item, the increase fur the half. year over the
corresponding half-year cf 1848, has been 24,3701., or at
the rate 0t*,..) per ceLt. Of this increase 14,0001., or at
the rate of seven par cent., i 3 on the ordinary pas-
senger traffi..; 1,8531., or 31 per cent. on the receipts
from perieclic-.1 tickets; and 8,3701, or 21 per cent. on
the goods trallie.
" 'l'he ngular increase t f traffic, since all the principal
portions of the present system of lines belonging to the
company were comyleted, has been very satitfictory.
The net amount at the credit of
the revenue account for the half-
year i 5...... ..• £187,970
W i:ercof is appropriated f.nr interest
on I,:an
`'.rence share 60,770
27,886

or
capital

e.iati ea pc

Leaving a balance of

£127,200

" rhs bala7ca would give a dividend of 21. 151. per
1001., Gn the ordinary cip.t4l, making the total diiidEnd
earned in the year 1349 at the rare of 41. 4;. per cent.,
but f.,,r the reasons statxl in their last report, the di-
rectors strongly recommend that a sum cf 15,0001. should
be set apart towards a reserve fund out of the disposable
a'ance. This will leave 112,200/. available for divi-
Ce-id on 4,615,63.11. cf ordinary capital, out of which the
directors recommend a dividend of 2/. 8.. per cent. for
e l a.f-year, amounting t.) 110,7841., leaving a balance
to the cretht cf the current half-year of 1,4164 _ _ _

" The directors recommend that the reserve fund and
the interest accruing thereon should be invest:43, from
time to time, in the company's eebenturos, or other ap-
proved securities, and keit quite distinct from the other
accounts of the company; and t'lat no transfer from the
reserve fund, in aid of any account, should be peraiittrd
without a special resolution of a meeting of the pro-
prieters.
" The tot 0 provision against depreciation made in the
year 1849, including the sum actually expended and that
proposed to be set aiirle at a reserve, will amount to
34927/. The line ii in gnod order, and the working
stock is 12rger and snore efficient than at any previous

priod.
At the lag, hali-yearly meeting a t7t.llle arran_4ement
was sanctioned with the Direct Portsmouth Railway
Company for et orkizz the Lhort portion of their projected
line between Epsoi and Le,:s.therhead. The construc-
tion cf this portion by the Direct Portsmouth Company
I eying been prevented by an injunction in Chancery,.
sine a-range:rent bus fallen to the ground, and the Direct
Portsmouth Company are applying to Parliament for a
Bill to abandon tt e undertaking. Under these circum-
stances the directors do not recommend the proprietors
to take any further .t,,pi is reerence to the matter.
" The sum advaread by the London, Brighton, and
South Cc a 1 Railway Company to the Brighton and
Continental Ste:x.l Packet Cemrany, has been repaid.
" Two vacancies having occurred in the direction in the
course cf the Ea t half-year, by the sudden and lamented
deaths of John Lawrie, and William Cash, Esql., they
have been filled by the election of Beaumont itanke3,
Eiq., and Charles Lushington, Esq., M.P.
"Le ► Schuster, Esq., John Nix, Esq., and Charles
Lushington, Esq., M.P., retire by rotation, and being
eligible for re-eietton, eller themselves accordingly.
John Urpeth Restrick, Esq., Eai also declared himself a
candidate."

The report cf the professional account tuts on the ac-
counts for the hal!-y a: ending 31st Dee,mber, 1849,

ai as fo:lows:

" lavirg comp'eed our audit of the accounts of your
company for the halnyesr ended 31st Dzcember, 1849,
we beg to report to you the result c f Oil' labours.
We find the published statements, intended to bo
laid Moro the shareholders on the 29th inst., t) be in
due accordance with tee boeks of the company; and that
tete books themselves are adequately supported by
original vouchers; in the instances cf payment* for land
purchaser, the deeds cf conveyance of the several pre-
pertiea have been produced to us.
" We have not failed to consider the appropriation
made of the half-year's expenditure under the several
heads of capital and revenue; and we find the accounts
to be correctly kept and stated in this respect, subject
nevertheless to the following question, which appears to
us to involve an important principle, and which we
submit for ceasideration.
"The question we allude to is, whether the sum charged
to revenue for repairs and renewals of rolling stock, is
as equivalent for the amount of loss occasioned by the
traffic? The principle acted upon by this company, in
order to provide such equivalent, being to maintain the
efficient value of the stock out of revenue, by means of
repairs, renewals, and additions, and net by means of a
reserved fund; it is of especial importance that no ea-
penditure of that sort be charged against capital that
does not effect a positive addition to the stock, over and
above its rcstoratior, out of revenue, to a state of com-
plete aid original efficiency ; upon what is the fact in
I his respect, appears to us, to depend the propriety or
otherwise of charging to capital the cost of three
new engines and tenders (about 6,0000, which have
been received jet Otcck during the half-year. It appears
to us an essential condition cf the safe working of the
principle adopted by the company, that the capital should
net be chaeged with the cost of new engines, that do not
"form an addition to the number originally possessed by
the company, and charged to capital account; according
to this view, the cost of the three engines in question
should be charged to revenue, inasmuch as (we are given
to understand) they do not equal the number of engines
which have teen worn out and destroyed.
"In conrexion with, and as illustrative of this ques-
tion, we notice the fact, that one locomotive engine has
been broken up during the half-year.
" With respect to the sums charged to capital for
timber trucks, coal waggons, and for stock for collection
and delis cry cf goods, we are informed that they consti-
tute additions ti the stock, which have been rendered
necessary by the increasing goods traffic of the company.
" Under the head of Carriage and Wagon Repairs,
the actual talf-year's outlay is diminished in the ac-
counts to the extent of something short cf 1,0004 This
arises in consequence of the stock of stores belonging
to that de; artmert having been more fully and accu-
rately taken than formerly. The effect of that proceed-
ing is properly enough set forth under the Lead of
Revenue. We notice the circumstance as one which
aff,ets the eiew of the net earnings of this particular
half-year.
" We are pleased to have it in oar power to state that
the accounts of the company are kept with great care
diligence, and intelligence, and altogether reflect the
greatest credit on the officers concerned in that depart-
ment of the company's business."
The CHAIRMAN pointed out to the meeting that the
professional accountants had not contented them-
selves with
simply auditing the figures in the ac-
counts, but they had gone into the question of expe_
diency in the expenditure, and the mode of keeping
the accounts. The result of their inquiry must be
as satisfactory to the shareholders as it was con-
firmatory of the soundess of the policy which the
directors pursued in keeping the accounts. With
regard to the paragraph in the last report, relating to
the engines, ho maintained that they had been pro-
perly charged. At present the company had 11.5
engines, considerably more than was necessary for
the efficient working of the line, and some of them
were now for sale. The directors, therefore, had
charged the actual stock in use to revenue, and that
was all revenue could be e xpected to bear, for when
the surplus stock of engines was sold, the amount would
be written off against capital and not against revenue.
The fact of their being overstocked with engines
arose out of past mismanagement, before he
kcame connected with the line, and he could not be
held answerable for it.
The proprietors would per-
ceive by the capital account, that a sum of T 200 000/
would be more than snfficitnt to complete all the.
works-of the line, and close the account altogether,
and he c3u!,l a, sure the shareholders that the opinion
thus stated in the report was founded upon accurate
and un
questioneble data. At a former meeting the
directors =rave an estimate of the amount that would
be required is complete all their works. That esti-
mate had a're ad y been exceeded by some 44.0001.,
but still the tlirectc rs were prepared to pledge them-
selves that the capital account could be finally closed
with an additional expenditure of 7,200,0 CW., and
Ewaplrie,a_fr a sufficient ma'gin in surplus land, to provide
-,,*contingencies. He fully anticipated that be-
j_;,,,,,,-fia‘rOhe year closed they would be in a position to
*f provision fox the whole of their ion-capita],

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