The Montgomery advertiser., 1907-01-03
CHARGES
sENsATICNAL ALLEGATIONs OF
 ROADS FORMER AUDITOR
No True Accountfag of the Mobile. Jackson and Kansas City Road Has Been Made In
 Years.

| {uoUltc, JAu G. Considerable interest has attached tt
 the affidavit filed in connection witi the application for receivers for thu Mobile, Jackson and Kansas City Rail | road by E. R. Stewart. the former audi tor of the road, in which some start. | ling statements were made of fictitious
 entries in the books of the company by Stewart, while auditor, at the behest l of the president and vice president of | the railroad.
 The ex-Auditor gives 1t as his opip- | ion that the railroad cannot long con- l tinue to operate, as 1t is constantly falling behind its expenses in the mat | ter of it's income, if the true condition | of the company could be shown by the hooks, unless some outside financial assistance should be received.
 The full text of the affidavit flied
 in the case by MT. Stewart Is as fol- lows:
 State of Virginia, City of Norfolk. Personally appeared before me. 0. R. Swlnk, a notary public in and for said state and county E. R. Stewart. who being by me duly sworn deposes and says that he was the auditor for the Mobile, Jackson and Kansas City Rail- road company from the first day Of March, 1903, to the thirteenth day of April 1906 and that as such auditor he had general charge and supervision over the general accounting depart ment of said company and was also charged with the duty of making the report of the value of the property of said company, both in the State of Alabama and in the State of Missis- sippi for the purpose of taxation; that monthly statements of the gross earn ings of the company and of its oper- ating expenses were made, and month ly balances struck: that for some time before his retirement from the com pany the gross earnings of the com pany did not exceed its actual operat ing expenses and fixed charges; that under verbal instructions from the president and vice-president of the company he made fictitious entries to the debt of permanent Improvements, and corresponding fictitious credits to operating expenses so as to make the books of the company show monthly an excess of earnings over operating expenses and fixed charges that did not, in fact, exist.
 Affiant further deposes and says. that the floating indebtedness of the said Mobile, Jackson and Kansas City Railroad company was at the time he left the road about three hundred and thirty-five thousand dollars ($35. .000) excessive of it's indebtedness, or alleged indebtedness to the Alabama Securities Company adjusted. or purporting to have been adjusted. between the two companies.
 On the third day of February, 1906, aflant made the return of the Mobile, Jackson and Kansas City, Railroad company to the board of assessors of railroads for the purpose of taxation and that 1t was his duty to qualify himself to make such return by con- ferences with and inquiries from sev- eral officers of the company familiar with such values and that he did this and from the information furnished him in connection with his own Judg meRt he fixed the values at 2724 miles of main track of said company situate in the State of Alabama at $2.500 per mile and 9.60 miles of side track of said company in Alabama at S1.000 per mile, making the aggregate of the two amounts $77.700. From the same source of information he also fixed the value of all the company's personal property in Alabama at S41, ,9s905. making a toal value of all of the property of the company situate in Alabama aggregate the sum of $119,- 6s905. which said values, to the best of his judgment and belief, was the reasonable value of all property!
 Af1ant further deposes and says that the value of the railroad of said com pany in Alamama is about equal, mile for mile, to the value of the company's railroad in the State of Mississippi.
 A-.-ant further deposes and says that the condition of the company's road bed. equipment and financial affairs are such that sad company cannot, in | affiants opinion and belief operate | it's railroad safely and properly or in | a manner to meet the reasonable de- | mnds of the public dependent upon | 1t for transportation and that in his | judgment and belief said company will | not be able to continue to operate its | at all for any considerable | period unless 1t gets finncial aid from | outside source.
 (Slgnedl D. R. Stewart
 Subscribed and sworn to before me | this. 4th day of December, A. D. 1906 |
 (My commission expires May 13. 19O7.)
 c. R. Swink,
 Notary Public.