Page:Hints About Investments (1926).pdf/125

 ing to the books, but truly and faithfully representing the condition of the business."

This exposure of the value of a balance-sheet as a guide to investors and shareholders is all the more significant and suggestive, in that it was uttered in the course of an address delivered at an annual conference of the Society of Incorporated Accountants and Auditors.

Nevertheless, it is the only guide, with or without a profit and loss account which is based on it, that is vouchsafed to the public by a large number of very important companies and it cannot be left out altogether, much as Sir Josiah's words would tempt one to save time, space and patience by leaving the balance-sheet buried under the heap of contumelious epithets that he has piled upon it.

When one picks up a balance-sheet one sees two lists of things with figures against them on one side and the other of a sheet of paper, usually with a dividing line down the middle. The left side, in English practice, is headed Liabilities, or Dr. (signifying debtor) and the right side Assets, or Cr. = Creditor. It thus shows on one side what the Company owes, on the other what it is owed or has got. The difference between the value put on the assets