TRUSTEES, EXECUTORS CO.

Evening Star, Issue 21747, 15 June 1934, Page 10

TRUSTEES, EXECUTORS CO.

FIFTY-SECOND ANNUAL MEETING IM6REASEO PROFITS—STEADY PROGRESS The fifty-second annual meeting of the Trustees. Executors. and Agency Company of New Zealand Limited was held to-dav in the board room, Water street. Sir James Allen presided m the absence of the chairman of directors (Mr G. R. Ritchie), and other members of the directorate present were; _Sir John Roberts, Sir John Sinclair, Messrs S. C. Sutherland, I’. (-• NejQ. ' , . , . Itl apologising for Mr Ritchie s alv senoe. Sir James Allen said that Mr R. G. Hudson was to have presided, but he was called to Wellington on business. It was a great compliment that Mr Hudson had been appointed to the responsible position of a director or the Reserve Bank. Security was given to the public who had business with the company when men of value in _ the commercial world were on the directorate, and were selected for such a position. Sir Janies also apologised for the absence of the Invercargill advisory directors (Hon.'A. F. Hawke, M.L.C.), Sir Robert Anderson, and Air John Gilkison, and the Invercargill agent (Mr J. B. Reid). Sir Robert Anderson was to be heartily congratulated on the title granted recently to him. Shareholders wished Sir Robert every success, and also expressed their gratification at his appointment ns a director of the Reserve Bank. REVIEW Of OPERATIONS Sir James then read the following statement prepared by Mr Hudson: Gentlemen,— Owing to the absence in England of our chairman, Mr G, R. Ritchie, the duty of moving the adoption of the report and balance-sheet falls this year upon mc._ ■ Before doing so, I wish to refer to the great loss sustained by the company by death on July 3 last year of the general manager, Mr E. E. Clowes. Mr Clowes joined the -company in 1903 as accountant, and on the retirement of Mr Simpson in 1919. he was appointed manager, and in 1930 was raised to the status of general manager. His service of thirty years with the company in these posts brought him into touch at one time or another with the majority of the company’s clients. His knowledge of business generally and trustee business in particular, coupled with a courteous and ever-helpful hearing, won for him the respect of the company’s clients. No better tribute could he paid to his memorv than the spontaneous expressions of sympathy and regret winch were received on all sides on the announcement of his death. A minute expressing its sense of the company’s loss and its sympathy with the relatives was pased by your hoard at the time, and a copy sent to Mrs Clowes. The hoard was fortunate in having on its staff as manager under the late Mr Clowes an officer of such outstanding ability and experience as Mr SmellieT- His appointment to the position of manager will, we feel sure, commend itself to shareholders generally, many of whom have already warmly expressed their approval. Now r , turning to the figures. As these have'been in your hands for some time, I presume we may take them as read.

PROFIT AND LOSS FIGURES. ■ The profit for the year of £1,827 17s ■ 0d is £786 7s 2d greater than last I year, and the board is pleased to he i oblc to recommend a dividend of 3J- '■ per cent, for the half-year, making 6 ■ per cent, for the year, an increase or 1 per cent, on last year. The dividend absorbs £1.200, and after, writing £250 off the company’s building and £lB 9s • lOcl off office furniture there is a balance of £358 7s 8d to add to the carry forward in profit and loss account. This result will, I am sure, be satis-, factory to shareholders, but I would point out that the improvement is entirely due to economies carried out during" the year resulting in expenditure being less by £1,355 5s 4d. On the other hand, gross income from commissions, rents, and investments show a drop of £568 18s 2d The reduction in interest rates by conversion and otherwise, which has been a feature of the past year,' has its reflection in lower gross profits, the company’s charges being, as you know, based at a fixed scale rate of commission on moneys collected. This scale, I may add, was laid down nearly thirty years ago, and, despite rising costs, has never been altered. The past year, from a trustee point of view, has not been devoid of these ■ difficulties; which are inseparable from a business such as ours during a period of falling prices. The conversion by the Government of its internal loan indebtedness at, March 31, 1933, was a huge undertaking, and threw a great deal of additional work on the staff, and this will be more fully appreciated when I mention that the company converted for its clients and trusts some £453.450 of Government securities. Local body conversions are now well under way, and these also entail a great deal of additional work, not only in attending the actual conversion, but also in keeping clients advised of the changes in income. TAXATION. Another feature of the work under existing conditions is the increasing complications of taxation requirements: In addition to the New Zealand requirements for income tax and unemployment tax the Australian Federal authorities are now making assessments against shareholders in New Zealand in respect of dividends from certain Australian companies which were

hitherto free of tax in the shareholders’ hands. These arc of a most complicated nature, and I would suggest that there is room for an understanding between the New Zealand and Australian Governments in' order to check the growing practice by Australian Governments of taxing outside of their jurisdiction. The practice started some years ago with the notorious Queensland Succession Duties Act, and the principle is now being applied by other Australian States to income tax. Tlie multiplicity of these taxation demands is extremely irritating. While on the subject of taxation, I wish to refer to the difficulties of those dependent on fixed infcome for their sustenance—the widows and orphans and the aged. The compulsory reduction in interest rates which is now be-

ing followed by a widespread movement towards lower interest returns on all classes of security and investment, is a serious enough matter, but when on top of this they are called upon to pay income tax at a rate of 33 1-3 per cent, greater than is assessed on salary or wages and also unemployment tax the position in many cases is almost intolerable. When the Government is in a position to ease the burden of taxation the rights of this class of people should, I think, receive consideration.

On the other aide of the picture the improvement in the returns of sheep farmers has made a marked difference during the past feiv months in the payment of mortgage. interest, and I am

pleased to be able to report that the beneficiaries who derive their income from this source through the company's hands have participated in the general improvement. NEW BUSINESS. Ja regard to new business, i think it can be fairly said that the company has held its own. The assets and investments controlled at March 31, 1934, stood at £3,610,376, an increase of £160,000. New wills reported are quite up to the average, and our experience as time goes on coincides with that of other institutions engaged in the trustee business both here and Australia—viz., that people are coming more and more to appreciate the advantages of a company such as ours offering permanency, security, and expert administration for the handling of their affairs. Our agents at Tiinaru, Oamaru, and Invercargill have co-operated faithfully with the 'executive in our office hero during the year, and while we could wish for a more rapid development iu those areas the board knows from experience that the establishment of a trustee business in any particular district is a very gradual process. On the whole the year just passed has been one of steady progress for our company. For the community it has been a year of hope revived, the bright feature being the steady but sure improvement which has taken place in Great Britain, with whom our fortunes are inextricably bound up. The return to prosperity, however, is still a Jong road ahead, and there are many problems awaiting solution. 1 here are signs, however, that the first nestfating steps are being taken along the ri°Trt road, and as confidence begins to flow back we, may hope that the progress will become move rapid. (Applause. ) Sir James personally added that he wanted the public to realise, as he was sure all connected with the company realised, the value of this company and of institutions of a similar nature to the public generally and to fathers and mothers who had to take care of provision for their children after their deaths. The great experience that Mr Smellie had gained in the administration of estates during his long service with the company and his general know'T ledge were of immense value to those who desired that their estates and property should be properly administered. Tho interest of the directors and staff in the clients gave the last-named a confidence in the future that could never be given so satisfactorily without a company of this kind. Ho therefore commended the company to the public in order that the very best may be done for them and for those coming after them.

MR J. G. PATTERSON’S REMARKS The motion was seconded by Air J. G. Patterson, who congratulated, the company on the result of the year s operations' It had shown steady progrese, and that had been maintained. He thought the shareholders ought to be pleased with the results so far as the dividend was concerned. The extra 1 per cent, was welcome, and if a company showed a 6 per cent, dividend he thought it was a result many other companies would be pleased to obtain. On. behalf of the shareholders Mr Patterson expressed the sense of loss sustained through the death of Mr Clowes. Ho had had the interests of the company at heart, and his sendees were of exceeding value. They had been particularly fortunate in having Mr Smellie as a successor. He had served his apprenticeship with the company, and showed the quality of being able to identify himself with the interests of clients. He agreed with the chairman that the company occupied a very important part in giving assistance to the community. it had a very large amount under its care in properties and investments, and there never was a time when these were so complicated, and it was necessary consequently that there should be constant vigilance ami capable management in looking after the affairs of the clients. In the management, staff, and local agents he thought they had capable men for this purpose. He had been impressed by the hopeful note of the chairman’s ad T dress, and referred to the optimistic spirit created by the rise in the price of wool. It only wanted economic production and better prices for their products for the country to once more embark on a prosperous career. The motion was carried.

DIRECTORS RE-ELECTED Air Alexander Sinclair moved, and Air D. J. Oalder seconded, that the retiring directors (Messrs P. C. Neill and S. C. Sutherland) be re-elected. The motion was carried. Replying on behalf of himself and Mr Neill, Air Sutherland said they deeply appreciated the honour of their re-elec-tion. Messrs William Brown and Co. and Alessrs Barr, Burgess, and Stewart were reappointed auditors. VOTES OF THANKS Air L. Deans Ritchie proposed a vote of thanks to the directors and staff. He knew that the chief aim of the directors was to conserve the estates under their dontrol. (“ Hear, hear.”) That they achieved good results was testified by the high reputation abroad of the company. The directors were inspired to render service to the whole community. The fees paid them were very small, and it could not b© said that the directors were seeking fees. After endorsing the previous speaker’s remarks of the Joss sustained by Mr Clowes’s death, Air Ritchie congratulated the directors ou the appointment as manager of Air Smellie, All members of the staff, the clients found, were actuated by the highest ideals of service. The motion was carried by acclamation. Replying ou behalf of the directors, Sir James said they realised their grave responsibilities, but they were pleased to be able to assist people to be in better circumstances than they would be in if the company was not in existence. On behalf of the staff, Mr Smellie said that the duties were exacting, a blending of sagacity, foresight, and sympathy being required by the staff. The example set by the board of directors permeated the staff, which co-operated very smoothly and efficiently. AGENTS’ EXCELLENT REPORTS

Mr J. M. Jenkins (Timaru agent) said that from a perusal of the accounts it must be gratifying to the shareholders that the profits from which they receive dividends had increased as compared with the figures of the previous year. At the same time he drew attention to the fact that such increased profits had not resulted from any increase in the company’s charges to clients for transacting the business with which it was entrusted. These charges, fixed in 1905, had remained at the same figure ever since. The present accounts were, therefore, a testimony to the sound policy of the board of directors and the efficient management of the company’s affairs. He referred to the death of the late general manager, Mr Clowes, and paid a. tribute to Ids services lo the company and its clients. He observed that since the company’s inception over fifty years ago there had only been three

managers, a fact which must be refarded with much satisfaction. The imam district had in common with the rest of the dominion experienced au increase iu its wool cheque, a factor which would help to instil the spirit of optimism and encouragement. The business in South Canterbury was in a healthy condition, and during the year the company had received appointments under wills. There vyas no hesitation in saying that the clientele was definitely increasing. He expressed appreciation and thanks to the manager, Mr P. O. Smellie, and the staff for assistance given during tho year. The Oamaru agent (Mr D. V. G. Smith) congratulated the company ou its improved position. So far as North Otago was concerned, conditions had improved to a very large extent, chiefly because the district was a grain growing and sheep farming district. The company’s business had, every indication of extending, as the public was more confident of the future of their assets. He apologised for the absence of the advisory directors (Messrs Robert Milligan and J. M'Culloch). 'Hie report of the Invercargill agent (Mr J. B. Reid) was also presented, Mr Reid stating that it was satisfactory to note that the year ended had shown a substantial increase iu the net earnings of the company. The balancesheet was a strong one, and was a sure indication of the public's complete confidence in the company. Progress bad been made in Invercargill, and a number of estates had been secured for the company. He had every confidence that the company’s business iu the Invercargill district would expand.