the assets and liabilities
statement.
3. The reports of the directors, manager, and consulting
engineer.

The first two items are largely matters of bookkeeping. They or
the report should show the working costs per ton for the year.
What must be here included in costs is easier of determination
than in the detailed monthly cost sheets of the administration;
for at the annual review, it is not difficult to assess the amount
chargeable to development. Equipment expenditure, however, presents
an annual difficulty, for, as said, the distribution of this item
is a factor of the life of the mine, and that is unknown. If such
a plant has been paid for out of the earnings, there is no object
in carrying it on the company's books as an asset, and most
well-conducted companies write it off at once. On the other hand,
where the plant is paid for out of capital provided for the purpose,
even to write off depreciation means that a corresponding sum of
cash must be held in the company's treasury in order to balance
the accounts,--in other words, depreciation in such an instance
becomes a return of capital. The question then is one of policy
in the company's finance, and in neither case is it a matter which
can be brought into working costs and leave them any value for
comparative purposes. Indeed, the true cost of working the ore
from any mine can only be told when the mine is exhausted; then
the dividends can be subtracted from the capital sunk and metal
sold, and the difference divided over the total tonnage produced.

The third section of the report affords wide scope for the best
efforts of the administration. This portion of the report falls
into three divisions: (_a_) the construction and equipment work
of the year, (_b_) the ore extraction and treatment, and (_c_)
the results of development work.

The first requires a statement of the plant constructed, its object
and accomplishment; the second a disclosure of tonnage produced,
values, metallurgical and mechanical efficiency. The third is of
the utmost importance to the stockholder, and is the one most often
disregarded and obscured. Upon this hinges the value of the property.
There is no reason why, with plans and simplicity of terms, such
reports cannot be presented in a manner from which the novice can
judge of the intrinsic position of the property. A statement of
the tonnage of ore-reserves and their value, or of the number of
years' supply of the current outp