Oxford eagle. (Oxford, Lafayette Co., Miss.) 1876-current, 1910-12-08
NEW ERA IN FINANCE
ACCURACY AND ueIIcIrv
PROVES TO BE A POPULAR
MOTTO.
Prompt Response to Bold Move o.
Preslden, vsII.-~Aeevrsey~ Recue
ed Western Union's surplus si5.-
oco.ooo.--Puelielty~ Restored Cor
rdenee ard It's stock Went up.

Are the great nnancIcrs OF the
country beginning 10 see a new llrhtr
Time vas. until recently In fact. when
the men at the head Of the big cor.
porations kept their business TO
themselves" as far as the Law would
allow. Capable men at the head OF the
big concerns. long realized the weak
ness OF their position. but what was
needed obviously, as In all great re.
forms. Was an unmistakahle occasion
and courageous man. The occasion
arose In the purchase uf the Western
Union Telegraph company BY the
American Telephone and Telegraph
company. and the man appeared m
Theodore y VAN. President Of the
purchasing corporation.
Il was last December when public
announcement was made that the
Gould holdings OF Western Union had
been taken over by the Telephone
company
ON account OF the high esteem in
which the management Of the teie-
phone company is so generally held.
great things were predicted a. a re-
suit OF the absorption OF Western
Union. by the press Of the country
the deal was most favorahly com
mented on. Il being widely pointed
out that under the direction of such
men as Theodore y Vail and his a..
sociates, the telegraph company was
bound soon 10 work Itself into \ 70
sition where Il could Offer the public
far more Efficient service than /, had
ever before been able 20 Offer
But very few months had elapsed
when II became apparent 10 tho new
management that a modern and up-
todate appraisal of the companv's
assets would make possible a far
greater degree Of efficiency of oper-
alton Here they said 10 them
selves. we've bought control of this
property and We know It's immensely
valuable but We don't know lust
how valuable These appraisais Of
real estate and securities owned we're
made long time ago. n Ne have
complete inventory made ~ every
thing we've got we can announce the
facts TO the public. start a new set of
books. and begin our responsibility
TO stockholders right there"
How Inventory Was Taken.
The most expert accountants and
appraisers to b. had we're put At the
task Their labors lasted over eight
months. Their report and its publi-
cation by the company marks an ep-
och in finance.
IL began by recommending an adj
fustment OF the difference between
the appraised and book values BY a
charge OF s5.595. .0S9 against sur
plus Book values OF securities held
were reduced to market values. bad
and doubtful accounts were "charg
ed OF" an allowance Of $1,000. 900
was made for depreciation. another
OF s50O,0o0 for reserve and SO on
until the old surplus OF sls.S67. 900
came down TO s5.I36. 900
II required courage, the publication
Of this statement to stockholders. say.
ing in effect: The property Of
your company has been reyal-
ued: the surplus isn't nineteen mill
ions. as YOU have been led 10 be-
lieve. but FIVE millions" but II was
the truth. and President Vail did not
finch. Accuracy ana publicity" he
declared. was essential. The stock
holder has a right to know. The
shares Of this company are scatter
ed from one end OF the Union TO the
other. This is more than a private
corporation II is a great national
enterprise The public is entitled to
the facts
The report was ordered published
forthwith. Fiaanelers OF the old
school and spectators generally were
aghast What would happen Would
the bottom drop out Of Western
Union when the shareholders realIz-
ed that their property was worth
$i3.000.000 less than they had sup
posed But the amazing thing
happened The stock went up and
stayed up. The public had respond.
ed TO this remarkable display Of
frankBess and confidence: TO the new
motto. Accuracy and Publicity"
The full significance Of the action
OF the new board is stated conciseIy
BY Harper's Weekly in these words:
Is this policy Of publicity and Of
open handed dealing with sharehoId-
ers and public the forerunner of a
similar movement on the part Of 9th
er big corporationsf Certainly IL is
20 BE- hoped that il Is. In the case
OF these big companies. dependent
upon public patronage and doing bust
ness under public franchise. can
there be any question of the right Of
the people to know
That right is being recognized.
II is recognized now in this epochal
act on the part OF the telephone and
telegraph interests. 1t is the dawn
Of new era in corporation finance. i"