THE FARMERS' CO-OP.

Taranaki Daily News, 9 May 1917, Page 2

THE FARMERS' CO-OP.

i • ANNUAL BALANCE-SHEET. The balance sheet of the Farmers' Cooperative Organisation Socjety of New Zealand, Ltd,, for the year end'ing'March 31, 1617, liaa been issued to the- shareholders, and, as usual, provides instructive reading. This year's balance shuet lias been awaited with" interest, for it deals with the first year's operations under the now regime. It takes time to establish a new business even though it is erected 'on the foundations of an old established one, as in the case of the Farmers' Co-opera' tive, more especially when its ramifications are as extensive as » provincial auctioneering company's. This is the Co-op.'s third year, and' easily its best. Tho commission account discloses a healthy increase. Last year the stock commission totalled £12,336, and the profit on merchandise and machinery . £1857. This year ..the figures are £19,281 for stock commissions, aqual' to 50 per cent, increase, whilst merchandise and motor returns remain at about the same figure. Wool and insurance commissions have increased from '£3l9 to £412, whilst land commissions account for "£1672. as against last year's £1233.' The share capital has been augmented by the issue of 1471 shares to 351 new shareholder!!, representing an increase in paid up capital of '£0417, whioh puts the campany in a much' stronger position, tne total paid-up capital now .being £29,783 and subscribed capital £70,890, against a paid-up capital of £20,316 and a subscribed. capital of £56*180 as shown in the. previous balance sheet.' The nett profit for the year fromyill departments is given at '£7454, as against £4374 on the previous balance sheet. This shows a considerable increase, but, looking more closely into the details, it shows that the profit must h&ve been much greater. For instance, we notice in last year's balanpp sheet provision for income tax; was' assessed at £485, while the pr,escnt year's 'balance sheets show that the amount which actually had to.be found,was £1283, a little difference of £BOO which the 1910/17 business had to bear. Xn.tliia year $978 has been written off for bad debts against a provision in the previous balance sheet of £313 9s lOd, ajid it would appear possible that the major portion of the amount now showing properly belonged to the preceding years or was a charge 'against the old business when taken over. We are gfedi to see that '£lsoo has been written eff the goodwill account, as against £IOOO in previous fits. This, to our mind, is a wise provision, as goodwill is always a fair subject for reduction, and, like,preliminary expenses, it should'be wiped; out as soofl as possible. -.-"', , i The improved condition of the company is shown again-in the overdraft and outstanding cheques. Last year the overdraft stood at £4BOO anil outstanding cheques at £10,282, making a total indebtedness to the Bank of 1£21,172. This year the debit balance has been converted into a credit balance of ''£Bloo, whilst outstanding cheques amount to £18,678,, a total liability to this .Bank of '£l-0,578. This.disdosos a much souud.nposition, and shows, the affairs of the Company are being very'carefully and efficiently carried on. lii regard to sundry debton itemssecured £6682, open .£54,811', making a total of £ol,4o3—last year's figures were respectively, secured r £l(!!)G, open £53,349. The secured debtors have further increased ilnil open account debtors ha#e gone down sliglitly. There is one point about tho balance sheet which may be questioned by the •shareholders, that is Hie reduction of discounts on commission in the allocatiun of profits and also the reduction of the discount on shareholders merchandise purchases. It is proposed to pay a dividend of 6 per'cent, on the "B" and "C" issue of shares and to carry the balance forward. Generally speaking, the policy disclosed in the statement of affairs is of a conservative nature, and we consider it is prudent'business and the company will soon find good use for its capital. Reserves should be built up' in good times s« that if e*£r bad times come—and we for one 'cannot visualise such a thing in Taranaki during the immediate future—the etmipany will be able to carry on without restriction and pay the shareholders the usual dividend. Throughout tho l)a!ance sheet can be 'considered very satisfactory, disclosing, as it does, that the affairs of the concern are being wisely directed by the'directors mid efficiently administrated by the manager. The directors, it would'seem, made no mistake in the ar/pointing of Mr. Lynsky to tho position of general manager, for undoubtedly most of the credit for, the improved state of the business and finance* of the. company must bo accorded to him.'