Omaha daily bee., 1910-04-20
Traction Water
Found by Experts
Who Made Report
Lincoln COmpany's Value Found to
Have Increased Over Million
in One Night.
(From a staff Correspondent

Lincoln Traction company has wat
cred" its value to the amount Of 1885,
72.76, according to a report completed to-
day by U. G. Powell and L. r. Wettling,
rate clerks in the employ Of the State
Railway commission, IN connection with an
investigation held in relation to a petition
from the citizens Of Havelock, a suburb
to the capital, for the reduction Of fares.
The value Of the company's property, says
the report, filed today, is $2,SS1 st6.07.
The contention Of the traction company in
resisting the efforts for a reduction of
fares has been hat II would cut the earn
ings on capital to an unreasonable and
Improbable figure.
Following is an extract from the report
to the commission, showing how values
changed In one night:
Our investigation has covered only the
period from the consolidation OF the Lin
colin Traction company and the Citizens
Railway company, January 81. 1909.
assets Of the two companies, as shown
by the books OF the Lincoln TRACTION com
pany and the reports submitted to yooHr
honorable body as of Jnauaryt 81, lSV9,
would indicate a value of &2,5O0,S6S.8O
which, by the Journal entries made for
opening opening the ig new ateig on on Tine the IeXt morn
Ss5s,6Ge.
Inc general railway plduAt III bhC ~
solidated books opened on February l, 1909,
Is shown at a valuation OF $24,O0O per mile
for track and overhead equipment IN paVeH
streets, and at $4,000 per mile Tor track
and equipment in streets not paved, COW
ering all Of the track and overhead equip
ment OF the combined companies ana IN
extension" so called on the books; ano
being the extension to Havelock, and also
tt efuTban es which Giea~ had been '~ Carried on the
Citizens books as q separate corporation,
There was arbitrarily added to the Vatue
Of the lighting. plant, as shown on wns
plant about 5000 ABOVE The value shown
on the books embarrassing evening;
Betwee1tt the night q ti9fy ~ ISs iatnps
the morning of FebruarY J lSVs, IN iiHe
manner the value Of the office building IN
creased from $500 to "STbCOO,, Outside In
testament Of realestatea Eei9a On y l Tsh,ss
OF s., 100, became wbyt1, l321l5e on February
ID. 1903. Tools, which had q value Of $2,IS4
on January 81, appear to be worth $l5.VVO
on the morning Of February l lsO9 rms
stock held in the CiizensRatlway
valued on the books at $1,016 January 81
was entered as OF a value OF 2,25O on the
morning of February l, 1879. t
At the same time the capitalization OF Lne
two companies consolidated was materially
changed. The first mortgage, bonds OF the
original Lincoln Traction company, when,
on January 81, 1907 showed as 100000 out
standing, were On 6pIuhAg - hNOs 1AS"N
to be $3.50, 900. This increase OF $4,000 was
added to the assets, and as a counter-bal
anclng entry The Lincoln Traction company
was charged with the amount and credited,
as q partial offset, With "a special dividend
OF SIS 92669, and most OF the balance OF
the debit to the TraetioBs Gompaanya 3y req.
gsinaf 1T tax III YofS t4s Ssis 81 bonds,
was fsed to- reduce bfHsopa a. ~ni,
We made Inquiry 'of, the accounting de-,
Ipartment, the former president MI Nc
Donald, and counsel q, The Traction com
pany, asking for an explanation of the
special dividend. and each oEithe explanaS.
lions Differed The. explanations we're gem
orally 10 the effect that the reason, for the
dividend was because o61he great variation
findings or the accounts payable, and the
dividend sWas declared to the stockholders
Of the old Traction. company for tAe pur-
pose of adjusting such difference, The
books, however, do not bear out this ex-
PLANTATION, as It would appear from the
books themseIyess that the, accounts pay
able OF the Lincoln Traction company were
very much in excess Of the amount said
to nave ben estimated, whereas the Citi-
zens accounts . payable appeared Ito have
been only $347., Without definitely stating
It to be a fact, the impression that 10 given
by the books would lead 10 the conclusion
that the real reason forJahis dividend was
Ito adjust the. difference in the profit and
loss account as of January 81, 1903, in order
that the old stockholders Of the Traction
company migt absorb all the profits for
the month OF January, which were shown
J on the books to be Sl4, ESQ. 49,, as against a
/ deficit shown. by the Citizens company IN
the surplus account Of 2,504.S2.