the office of the clerk of the county where the main business office of the corporation is to be located, the proper fees and taxes must be paid to the Secretary of State, the State Comptroller and the County Clerk; a meeting of the incorporators must be held accepting the charter thus granted, and the directors must meet and elect officers. The number of incorporators must not be less than three, which is also true of the directors. At least $500.00 must be paid in at the time of filing the certificate, this being the only restriction on the total amount of authorized capital.

All this is found in general business and stock corporation laws. Any answer must be based on knowledge of the several sections of the above laws applicable. The authority must be found in the statutes themselves, though "while a business corporation contains the said laws arranged in convenient form, no accurate answer can be made except that it be based on the law itself and the actual cases decided thereunder." Only by careful classroom work coupled with actual practical illustration can an accurate and working understanding of any phase of law be obtained.

Periodical Literature.

Selected by MILLS E CASE.

Key to abbreviations: A.-Arena. Acc.-The Accountant. Acc. Ma.The Accountants' Magazine. B. B. Business Man's Magazine and Bookkeeper. B. Ma.-Bankers' Magazine. B. Mo.-Bankers' Monthly. C.Cosmopolitan. C. T. B.-Coal Trade Bulletin. Eng. M.-Engineering Magazine. I. A.-Iron Age. I. A. J.-Incorporated Accountants' Journal. Int. Ry. J.-International Railway Journal. J. A.—Journal of Accountancy. M. Ma.-Moody's Magazine. Mfg. Rec-Manufacturers' Record. N. Y. L. T. J.-N. Y. Lumber Trade Journal. S.-System. So. Ba.Southern Banker. W. Elec.-Western Electrician.

The Journal of Accountancy

Vol. 2

Published Monthly under the auspices of the
American Association of Public Accountants

JUNE, 1906

No. 2

Standard and Uniform Reports from Public Utilities Both Municipally and Privately Operated.

By HARVEY S. CHASE.

It may be taken for granted that, theoretically at least, we are all in favor of standard and uniform reports from public utilities and municipal enterprises; that we appreciate the necessity for such reports and that we earnestly desire to see standard schedules authoritatively provided for them. Accepting this position, we may then address ourselves immediately to the practical difficulties, and the question arises, "What obstacles must we first overcome before such standards can be provided, and, further, what authorities must we invoke in order to have such forms accepted and used universally?"

The authorities must evidently be invoked through statutory requirements of states. Illustrations are before us in the regulation of the accounts of gas companies and electric companies by Massachusetts, an example now followed by New York; also in the control of railroad reports by the Interstate Commerce Commission and by the railroad commissioners of various states. Still other examples are evident in the regulation of municipal accounts and reports by Ohio, Wyoming, New York, and now, under an act just passed, by Massachusetts.

The authorities are therefore available and sufficient. Our next question, therefore, is, "How can these authorities be instructed and incited to action, and to action along uniform lines, which is fundamentally important?" Evidently a supreme authority as a leader is necessary. Have we such an authority and is it inclined and prepared to lead? In the writer's opinion we have such an authority in the United States Census, and already this

authority has surveyed the field, has sharpened the ploughs and is breaking up the ground. In fact, it has already run a number of remarkably straight and uniform furrows. In so important a question we may assure ourselves that where the United States Census leads, the state boards and municipalities will surely follow.

The fundamental authorities being thus in evidence and in activity, we may properly devote our attention to the difficulties. What are these difficulties?

In an endeavor to get at some of these things at first hand and to make them clear to himself and to others in a practical way the writer has taken the best material available, namely, the annual returns by gas and electric companies and by municipal industries in Massachusetts, and has attempted to set up their financial transactions upon a standard schedule.

For this schedule a form submitted at the recent conference called by the Census Bureau at Washington in February has been taken. This form had subsequently been discussed and amended by a special committee of the American Association of Public Accountants appointed for this purpose by the President of the Association. The deliberations of this committee are not yet completed, and it was for the purpose of furnishing material for additional discussions in that committee as well as of preparing this article that the examination of these Massachusetts returns was undertaken.

In order that there may be no misunderstanding I will state plainly that the forms here set forth have not been finally accepted by any individual or committee. They are tentative forms devised for the purpose in hand and subject to modification hereafter. With this explanation the schedule may now be presented, mainly as a basis for further discussion.

We will first consider the proper form for "Revenue and Expense" transactions of a public utility during the fiscal year, including in this item all revenues accrued during the year and all expenses incurred during the year. The fundamental items of such a statement are three: First, the revenue; second, all expenses which must be paid ultimately out of revenue; third, the excess (or deficiency) of revenue for the year and the disposition of it. My experience advises me to reverse this arrangement in part and to set forth "Expense" first, followed by "Revenue" and then