New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1888-02-15
TO SCRUTINIZE RAILROAD REPOhI".


Az .rD1ron NEEDED WHO SHALL REPORT ON THE
REAL CONDITION OF PROPERTIES.
Tho lack OF accurate Information about the reai
condition Of railroad properties has been one OF inc
CRYING evils In Wall Street for many years remeu'
Is propossd by Frederick T. Brown, OF the we'll hho"h
firm OF H. L. Horton & Co.. in communication 'o
the members OF the stock Exchange, who suggest inc
establishment Of an auditing department. HIS propo
sition is as follows: - ., 1000
To the Members Of the New.York STOCK Exchange
Tn n communication addressed to you two years ago
advocated the creation Of Statistical Department "a
the NeYork Stock Exchange" to be presided over ny
an auditor thoroughly conversant with railroad reports
To-day the public demands such information as wei,
trained and independent auditor can alone give tno
indisposition of the public to operate In s'oeS
comes from the doubt expressed boh here and more
in Furope OF the truth directors reports to
At a meeting OF the Z" Institute OF Bankers helu on
January A. 1888, in London the report OF winch has '
reached US MI J. W. Birch says: 49,,
american railroads open an enormous heia ios .ns
investment Of English capital people are caeful
In the selection Of the securities put thefe 10 Nv" Va
treme want Of knowledge Of these securities"
Mr. Joseph Price, who is well known IN this couii"'
m ,ba manager OF the English Association OF American
Bondholders said who play with American specu
Iatlve shares are at the mercy OF van SUI. =, ~
and again he says What are called AUDITORS Oh ,h'
American railways are fedly ony uie "'V0 - 49,
companies themselves"
What we need restore the confidence OF the nVesNs
and speculative public auditor who shall have nc
connection with the company whose report ne eAahe
Aao,,,ble only 20 the Committee OF the Exchange; who
shall expose all the weak points uncover the mysteries
and lay facts alone before the people
What would this do for US as brokers'
H. We could undersandinely commend securities 0
,pve.to feeling that as thorough examination as was
possible had been made by our own servant , -
fo1 The knowledge that railroad was solvent ana on
sound basis would give confidence to buyers
in times Of panic and SO limit inc shIihN"s0 Al " ~
ud he
For the public this auditing Of reports "ouln DC u
inosra,le value Directors OF railroads knowing N"
tboir ,opors would carefully Analysed as soon !"
issued would be extremely cautious In signing ieppi
hat they had not personally investigated most thorOus
A prominent railroad auditor TO whom suggested '
oho,o outlined action said: Give the 11ur preceding
reports Of any railroad and will show you Inc "eai
,oot and inconsistencies of the fifth; could probso!
DO It with two preceding reports
T. may be urged that the railroad companies would no
,it cess TO their books settle any doubtful Item
= t,..i, ,onorts I answer In that the EXchang
should Immediately sukc their securities on u'cIr i4S
the credit Of any railroad in the country would not s"
moment under circumstances 1t would forfeit Ia
confidence Of the investing public and It's a0ll'y
borrow money would cease as 1t was known una
is securities were not current ON your bAcnaNgo y
reason 81 such refusal ,
ADOPT this plan and the American public Will agah
anraar in your Exchange investors and spectators
and Europe seeking for securities paying leasonaol
returns Sill take all that their eNergrowlhg surplus VII
permit fhkDhdVA i, Dn'", r.
or IL. l.. Horton Coz
nathan I'm favor OF an auditing department o
tie Sto.k Exchange has been signed by these well
known firms among many others.
Drexel Morgan Co., Winsiow' Lah'er W.
1t.dsr ps,hofv & Co Brown s. Co,
j. ami W Seligman Il Co, Morton Bliss g So'
Kuhn. Loeb q GO, \eiuiyo " o.
Il.L. tr,. & Co LadonOurg. Thallnan Co,
Malt and Phelps & Co, Johh f@'0n I" w.
W. =. n chOls & Co. hanS"rteh " w.
Work. suong Co, Van Sch~cA q o.
v-sis...,sc & % Jameson, Smith & ca,
Henry C.sss& Co, Charles ie'H q" o.
Van Iulhurs * AtterJurS j. h. "rac'o "'S'oi'0'"
j.. p. Flower & co, IL H. HO.II'Ie4 " ~"
Nh. & ecbev Ii. l.. Horton & 20.