Evening star., 1914-12-30
CORPORATIONS TO MAKE
DEPRECIATION CHARGES
Many Banks and Companies Will
Adjust Book Values on Invest.
ments to Market Prices.
Bankers Prefer State and Municipal
Bond Issues-Interesting Facts
and Figures-Gossip.
BY I. A. FLEMING.

Many corporations in insurance
financial and other lines will take ac.
tion with the advent of the new year
looking to the adjustment of book
values of their investments to the cur
rent prices on the markets. 1t will not
be an especially pleasant task, thi:
writing off of thousands and even mil
lions. but it is in line with the pres
ent-day policy Of being clean and
gives personal satisfaction to share
holders and to officials who have taken
the action.
There will be those who will make
no changes in their book values In
order to make a good showing. but the
conservative and safe management Will
suggest writing of palpable losses and
Increasing book values. should market
conditions warrant, at a future GATE
Insurance companies and otnefs Wno
carry large investments Will De tne
heaviest sufferers. Banks have been fairly
fortunate, especially during the last half
of the year when their resources nave
been generally employed at fuii legal
rates of interest. The fact that the
National Bank of Philadelphia have both
written off millions from their assets
valuation is an evidence that the banking
fraternity has not ESCAPED unscathed:
of writing off that will be done. but one
big founda tons Investments have shown
recessions in value totaling nearly
S20,000,000.
Washington bankers will have COM
paratively small depreciation charges,
as they have not been heavy lenders on
New York Stock Exchange collateral,
and loans that have been made on local
securities have been amply margined.
Banks Investments.
The trend toward railroad, municipal,
county and state bonds by the banks
of the country is evidenced by the
statement of the 26.765 banks of all
classes reporting June 80. 1914, to the
controller of the currency.
Railroad bonds were not considered
especially desirable by the banks from
1910, but last year the purchases OF
these issues increased Sl45,oou,ooo. IN.
state issues increased Sis, 100000.
which may be looked upon as move
ment to avoid income tax payments, as
these issues are free from this tax
creased $2.3O0.000, some of which may
represent writing off to the market
quotations, and public utility bond in
vestments decreased S137.000,0 900.
30, 1914. SIS, $500. 900. book value. in
bank shares. $73.40O.00O in railroad
stocks, s4s, 700. 900 in unclassified stocks
and $953, zoo, 900 unclassified bonds and
other securities.
These figures. in connection with
with June so. may throw some light on
depreciation chsytss tospe made Janu-
airy I, 1915.
Local Bond MaIkst...
There was a good demand for Wash
Ington Railway and Electric per cent
bonds at sOX and fair block changed
ownership at this figure. Potomac
Electric consolidated IS were a shade
easier at 80. The bid on Washington
Gas 5s was reduced an eighth to l02A.
Other issues remained unchanged.
Financial Notes.
There is still outstanding about
y152, ,0oo, 900 emergency currency. Much
Of this will be retired before the first
of January, when an additional tax OF
one-half of 1 per cent will be made.
An employe of a corporation or firm
doing a commission business does not
incur special tax liability as broker,
il is ruled by the internal revenue com.
missioner. If engaged in, general
busiaesssfor all spplicantss he does In
November income of the Chicago
and Northwestern Railroad Company
shows a decrease of S6O2.575. Freight
loss was S645.93 and passenger. reye-
nue. decreased S1S8, l37. but the items
of maintenance of way ana equipment
suffered severely also.
American bond houses were the Joint
buyers of s6,900.000 City of Montreal
; per cent three-year bonds. The pur-
hase was on 5h per cent basis