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 should try to indicate the sum that the assets might, if sold, be expected to fetch.

This criticism is unfortunately true. If you look back a few pages at Sir Josiah Stamp's observations with which this chapter began, you will see that even this very clear-sighted examiner of balance-sheets expresses himself with a certain inconsistency. He tells us very clearly what a balance-sheet ought in his opinion to be—namely a "faithful record of the employment of the total capital invested in the business, whether as an original outlay or retained profits." This surely can only mean that what should be shown is all the money that has been spent in purchasing the assets and in making provision against the inevitable decline, owing to depreciation by wear and tear and "obsolescence," in their value. In other words the full amount charged against depreciation of wasting assets: (such as machinery, plant, etc.) and against provision for doubtful debts, declining value of investments and other such precautionary expenditure, should be clearly shown either by being put down as written off certain assets or included in a depreciation fund among the liabilities, the assets being left at the sums that they cost.

This system would certainly give us a