Commerce, Mining, Finance

Evening Star, Issue 23368, 11 September 1939, Page 9

Commerce, Mining, Finance

Metal Scrip Finishes Stronger

Rubber Committee Increases Quota Australian metals again commanded special attention on Hie Dunedin investment market this morning, the demand expanding appreciably for all issues. Buyers came on prepared to pay higher limits, while sellers increased valuations accordingly. Other sections were inactive with practically no interest in Commonwealth industrials. Evidence of Great Britain’s financial preparedness is to be seen in the firm reopening of the Stock Exchange. Although business was necessarily restricted, operations were conducted after a break of only a long week-end. To enable the fulfilment of the Anglo-American barter deal, the regulating committee increased the rubber quota to 70 per cent.

BUSINESS EDUCATION EMPLOYEE AND SHAREHOLDER SUCCESSFUL METHOD OF AN AMERICAN CONCERN ANALYSING THE ANNUAL BALANCE-SHEET Industrial management is no longer synonymous with ownership. It has to satisfy two strong and vitally interested groups—employees and shareholders. These groups live in different economic worlds. The promotion of concord between them is, therefore no sinecure, says the latest issue of ‘ Rydge’s Magazine.’ Methods being adopted overseas to secure harmony between the two catnpa are based on the disclosure of intimate facts and figures which the old-time business proprietor went to great pains to hide. An excellent effort, directed to stockholders comes from General Mills Inc., Minneapolis. For years this company’s annual reports Were pretty much stereotyped along the usual lines. Recently, the directors decided to make material changes. They concluded that their financial statements were fully comprehensible only to persons reasonably instructed in the terminology of accounting, and as about 50 per cent, of the shareholder's were women, something simpler was indicated. Using its house organ, ‘Millwheel,’ as a vehicle, the directors set themselves but to explain in plain words what the company had on hand at the beginning of the year, what is received from its customers during the year for its products and services, what it spent to produce those products, and services, what it did with the difference between what was received and wliat was spent, and what was on hand at the end of the year. Except for the size of the figures, it was simple account keeping understandable to a child. By way of illustration, the ‘ Millwheel ’ stated that the basis of any company’s annual report consisted of three tables—the balance sheet, the income account, and the surplus account, or the balance sheet, the profit and loss account, and the appropriation, account. The balance sheet was described as showing what the company had and what it owed at the end of the period. The description goes on to say: “ It is called a balance sheet because the total of what we have must always equal the total of what we owe. ■ This sometimes puzzles people. If we owe everything we have, how are we ever to get aheadH It must be remembered, however, that whatever a company has belongs finally to those who own the company, and not to the company itself. In our case, the owners are the approximately 10,000 stockholders, who have entrusted their money to us in order to provide the tools, materials, and other means whereby we are able to do our work.”

BUSINESS AS USUAL LONDON STOCK EXCHANGE REOPENS A QUICK RESUMPTION Press Association—By Telegraph—Copyright LONDON, September 9. The reopening of the Stock Exchange with such promptness strikingly reveals how much better prepared financially Britain is than she was in 1914. It took longer than six months to resume restricted dealing after the outbreak of the last war, whereas this time “ street ” business was resumed on September 5 with a break of only a long week-end. Business necessarily has been restricted, and dealings in gilt-edged stock have been handicapped by the fact that the stock registers of the Bank of England was removed to Hampshire. Dealings in other shares is largely a matter of negotiation since, pending a clarification of the outlook, few are ready to part with stock. Rubber enjoyed a sharp rise, but failed to maintain it following a setback in the price of the commodity when the committee announced that the quota had been increased to 70 per cent, to enable the fulfilment of the Anglo-American barter _ deal. Heavy business was transacted in tin, totalling about 3,400 tons in three days. STERLING EXCHANGE LONDON, September 9. Exchanges: New York, 4.02 to 4.06; Paris, 176 J. RUBBER QUOTAS REGULATION COMMITTEE'S DECISION (British Official Wireless.) RUGBY, September 9. The chairman of the International Rubber Regulation Committee, acting under the specific authority of the committee, has issued the following communique:— “ In view of a request received from His Majesty’s Government in the United Kingdom for the release of additional rubber to enable the Government to implement the terms of the agreement between it and the United States Government for the exchange of cotton and rubber, this committee, reviewing part of the decision announced on July 25, has fixed the following revised percentage of basic quotas for 1939 as the* permissible exportable amount for October. November, and December:—7o per cent. The quota had already been fixed at 30 per cent, for the last quarter of the year—the same figure as for the present quarter. SYDNEY STOCK EXCHANGE

The income account and surplus account wore explained with equal simplicity. The management of General Mills was not prepared for the amount of publicity that the report received. Financial papers published articles about it ; accountants gazed on the effort with amazement, and banks requested duplicates to serve as copies. Above all, the shareholders generously applauded the management’s efforts. They were almost overcome by finding that somebody was willing to take the trouble to tell them what the. annual accounts and reports were all about. Say what we will, the public, at least in part, still regards the motives and methods of business with suspicion. As in America and England, so in Australia does the need arise for practical efforts to show that the grounds for suspicion are flimsy. This is best done by driving business out into the open. AUSTRALIAN WOOL CLIP PURCHASE BY BRITISH GOVERNMENT LONDON, September 9. The Government is arranging for the purchase of the Australian wool clip, and, as recent prices have not covered Australian production costs, it is felt that the agreed purchase prices will be higher. The maximum prices will be as follows:—Australian scoured clothing fleece. 70’s quality, 224*1; scoured super-merino combing, 64 s auality, 22£d; and Now Zealand s, all 50 to 56 quality, scoured and second pieces, 134-d; slipe lambs, greasy average lambs, 12Jd.

CARRYING QN BANK OF NEW ZEALAND IN LONDON A cablegram from Mr D. F. llcid. manager of the Bank of New Zealand in London, has been received stating that business will continue to be conducted as usual at the London branch. It was also mentioned in the despatch that already some of_ the banks had transferred their activities to quarters outside London, but that others had decided to remain where they were in the citv while conditions permit. The Bank of New Zealand premises in London are situated in the very heart of the city, facing the Mansion House. Bank of England, and Royal Exchange. But premises situated in Kent, but near London, have been secured and equipped for the Hank of New Zealand and are ready for immediate occupation.

SYDNEY, September 9. Commonwealth Bonds— £ s. d. 3 per cent., 1948 ... 93 -2 6 3j} per cent., 1949 ... ... 95 16 3 3’J per cent., 1942 ... ... 99 12 6 35 per cent., 1954 ... ... 97 5 0 3J per cent., 1947 ... ... 100 15 3 3J per cent., 1948 ... ... 100 5 0 35 per cent., 1954 ... ... 97 15 0 4 per cent., 1944 ... ... 100 3 9 4 per cent., 1950 ... ... 99 15 0 4 per cent., 1953 ... ... 100 0 0 4 per cent., 1955 ... ... 100 2 6 4 per cent., 1957 ... ... 100 1 3 4 per cent., 1959 ... ... 100 3 9 4 per cent., 1961 ... Com. Bank of Sydney ... 100 17 6 ... 16 7 0 Com. Bank of Australia ... 0 13 3 Bank of N.S.AV .... 25 8 0 Tooths 9 8 0 Anthony Hordern ... Australian Consolidated 0 ln12 8 dustries 1 12 0 Broken Hill Proprietary 3 5 3