New-York tribune., 1903-04-27

100000 Of Indebtedness to the Metropolitan
charged back to the lessor companies accounts on
As to 10. g. I'm relation to the Second Ave
for same Construction work on certain leased
lines: 5: Excessive charge for reconstruction on
ee seet to T0o3 IN d
year a Of nT PT,r0Gs S9nsTgs0p year tbs
accountants lump the four charges. and say
mainly to the cost Of construction work and are
merely expressions Ions, OF opinion that this cost was
70 form opinion who does. not know Of his own
which a given piece of road was built, The
work of construction is not necessarily nor often
completed when the road is put into operation
SAY ERROR WAS CLERICAL
Regarding No 3. Excessive charge for en-
cheering and superintendent on the Central
Park North and East River Railroad Com
pany." they say:
Under this headline attention is called 10 an entry
in the companys report OF 1902 OF s322 expend-
thereto some other items it is made appear that
the charge for THIS service q2Sn POI "a NILE ano nal[ o.
the conpanys report in respect 70 this charge do
sS22 $40 IS should have been eharged to track and
course does not affect the aggregate charge To
CONSTRUCTION and s99lPnenLi s4 m & as eosn OF th7S7
Regarding No. s which took up excessive
claims for the value of investments credited in
the company's general balance sheets the ac-
countants say:
II is here coutended that the valuation placed by
the company upon its pledged and unpledset Sc.
curities is far IN excess o. t9e aet'ti V,,I @ Ia
issued a certain amount Of Metropolitan stock t0r
these investments. which stock you pay per
cent dividends the company Is paying out an
nuaIly q 10000 to receive in return & $5gog {sf
ments as it's own annual reports prove, is but 800
OOg The annual reports prove nothing Of the kind
They prove that the Metropolitan company derives
IN zn4
onr Of ese proDsrts it derives from ts also
ali their net returns over and above their regular
dividends to say Eotn1g OF [a9 Taae OF woe
The false assumption shown above renders th'S
Moreover as matter Of corre.t accounting.
these investments should De held on your 9ooAs s1
corporation Of this character would undeEtakIs 70
agree gree vi With the fluctuations Of the market.
In reply to No. they say:
a5g TheT fsf f 5 50 be Of g2 TO- BE- tT pad to @
MetropIIitan e9mpa4y Py tns s f5 % % 3se9 f6
any other purposes than those mentioned N tIls
isS2 The auditor Of the company certiies that On
ebruaTy u 80 shs , ts 73 n of WHICH S. Isl SO Is
represented the cost Of the Third Avenue & s{ock t
incurred in the extension OF the electrical system
to Metropotap, =, pe m II o seems h 10 ge pc 20 sxe5d
the electrical system to the metropolitan hnss ,
fnterrrban lease took effect 50 that it follows that
he OF
the debt Incurred in or occasiOned by the purchase
Of the Third Avenue stock and In defrayins the
The suggestion that the Interurban transaction
provided for the gsnsGa G G 6 PF5sosy % @ OF fag
simply because that happens to be the dlfsrence
served for refunding purposes. and SsSlSo0O. tne
amount Of the underlying bonds IS entirely met oy
been overlooked in the memorandum to the effect
sr1 1920 be used for any other than refunding
purposes 1t is simply the usual CONDITION OF re-
ding rrlrc 90 q
upon underlying bonds bearing high rates OF inter-
Your treasurer informs us that the 1nterurban
company has paid to the Netropota1 &c GelSany iS m
From this the floating debt existing az the
cnnstrucoH expenditures Subsequently incurred
have been more than provided for
The report then continues in part.
No X Alleged payment Of large sums Of money
The TRANSACTIONS to which these items refer are
similar in principle &c the transactons mentioned
gave to the MetropoIitan not cash but notes ON
cc'J a TDaIv = Of bavin avaed itself of the Print
ed form Of the report OF the t'alir2sd G0InTnis-
which it reyer received
The claims of the METROPOLITAN company against
its lessor companies which in this memorandum
said anc-nt 70 sl3lse 55s 81 and OF which =
represent a debt for improvements ard betterneutS
leased properties The extent 20 which they are
founded" would no doubt BE- realized by any lessor
No XI. "Exesssive charge for new construction
in the 1872
The matters which are undertaken Be criticised
under the headline above not susceptible OF IN
teIgent discussion from entries iv "1cfal reports
Whether or not a road CCsfs too much in the ab-
sence OF thorough and detailed F~0u-ledse Of all
the physical conditions under which II built
is the merest cue ufsswOrk- In the memorandum
ma FuffrenCeS Of excessive cost based
the difference between obligations reported paid
and obligations reported incurred and OF course.
there T. absolutely basis OF such inferences- In
ferences of excessive cost are also based upon the
djsnositon Of construction charges which occurred
IL, at h. the eIef~C-c'..sfu
leased of the Interdrban- These charges had been
heretofore undistributed. They related 70 work
previously done and the memorandum makes the
mistake OF assuming that they related only 70 the
work reported under way In 1902
No. %II-'Difference in balance sheets and IN
come account reported March 81. 1902. 90 the
se425 TO ST. LOUIS AND RETURN
via Pennsylvania Railroad Tickets on sale April