NIVRAHA149_00782 |
Vorige | 782 van 1308 | Volgende |
|
klein (250x250 max)
gemiddeld (500x500 max)
groot
Extra Large
groot ( > 500x500)
Hoge Resolutie
Allen (PDF)
|
Deze pagina
Allen
|
758 EXPANSION [Bk. IV
tion is able to purchase material, equipment, and supplies more
intelligently and at better terms than the local organization.
It is presumed that the central organization can deal more intelligently
and far-sightedly with the public authorities and the
customers than can the local organization. It is presumed that
the central organization can secure the capital required for extensions
more easily and at cheaper rates of interest than the
local organization. Upon the truth of these presumptions—
particularly the first and the last—rests the economic and social
justification of the public utility holding company, and so important
has this form of organization become that each of these
grounds of economic efficiency should be carefully weighed.'
Superior Technical Efficiency.—The superior technical
efficiency of a centralized management as compared with a local
management is most often alleged as the conspicuous advantage
of the public utility holding company. This allegation deserves
considerable attention. It has been pointed out already in con-i
The advantages of the public utility holding company over the independently
owned and operated local utility have been often reviewed. Nowhere
have these advantages been more clearly expressed than in a certain
brief filed May i l , 1914, with the Interstate Commerce Committee of the
United States Senate with reference to Senate Bill No, 4160. "The holding
company unites under one control and management the public utilities of
several communities. The increased volume of business so obtained enables
the holding company to make the expenditure necessary to secure a thoroughly
competent executive, engineering, and operating staff, whose services
are available to all of its subsidiaries. Thus, along with the resulting increase
in efficiency, the expenses of each subsidiary are materially reduced.
Expenses are further reduced by the standardization of materials and supplies,
and by the purchasing of such supplies by skilled purchasing agents
in large quantities in a far wider market and upon much better terms of
credit than could possibly be secured by the separate local companies acting
independently. The centralized expert management effects further economies
in the cost of production by the standardization of operating and
accounting methods. Plants are combined and construction work is standardized,
so that equipment outgrown by one community can be utilized by
transfer to another smaller community, instead of being discarded as useless;
in this way the enterprise is run with a minimum amount of capital, and
depreciation charges are materially lessened. The distribution of the
business over an enlarged territory 'averages the risk' and secures the holding
company against irreparable damage from purely local causes. All of
these improved conditions operate to increase the attractiveness of the enterprise
to the investor, and, consequently, to bring about the very great
economy of decreased cost of capital and the resultant fixed carrying
charges."
Beschrijving voorwerp
| Titel | The financial policy of corporations |
| Auteur | Dewing, Arthur Stone |
| Jaartal | 1926 |
| Collectienaam | NIVRA Historisch Archief, UBVU gedigitaliseerd |
| PPN | 344552586 |
| Toegangsgegevens (URL) | http://imagebase.ubvu.vu.nl/getobj.php?ppn=344552586 |
| Signatuur origineel | NIVRAHA149 |
| Evaluatie |
Beschrijving
| Titel | NIVRAHA149_00782 |
| Transcript | 758 EXPANSION [Bk. IV tion is able to purchase material, equipment, and supplies more intelligently and at better terms than the local organization. It is presumed that the central organization can deal more intelligently and far-sightedly with the public authorities and the customers than can the local organization. It is presumed that the central organization can secure the capital required for extensions more easily and at cheaper rates of interest than the local organization. Upon the truth of these presumptions— particularly the first and the last—rests the economic and social justification of the public utility holding company, and so important has this form of organization become that each of these grounds of economic efficiency should be carefully weighed.' Superior Technical Efficiency.—The superior technical efficiency of a centralized management as compared with a local management is most often alleged as the conspicuous advantage of the public utility holding company. This allegation deserves considerable attention. It has been pointed out already in con-i The advantages of the public utility holding company over the independently owned and operated local utility have been often reviewed. Nowhere have these advantages been more clearly expressed than in a certain brief filed May i l , 1914, with the Interstate Commerce Committee of the United States Senate with reference to Senate Bill No, 4160. "The holding company unites under one control and management the public utilities of several communities. The increased volume of business so obtained enables the holding company to make the expenditure necessary to secure a thoroughly competent executive, engineering, and operating staff, whose services are available to all of its subsidiaries. Thus, along with the resulting increase in efficiency, the expenses of each subsidiary are materially reduced. Expenses are further reduced by the standardization of materials and supplies, and by the purchasing of such supplies by skilled purchasing agents in large quantities in a far wider market and upon much better terms of credit than could possibly be secured by the separate local companies acting independently. The centralized expert management effects further economies in the cost of production by the standardization of operating and accounting methods. Plants are combined and construction work is standardized, so that equipment outgrown by one community can be utilized by transfer to another smaller community, instead of being discarded as useless; in this way the enterprise is run with a minimum amount of capital, and depreciation charges are materially lessened. The distribution of the business over an enlarged territory 'averages the risk' and secures the holding company against irreparable damage from purely local causes. All of these improved conditions operate to increase the attractiveness of the enterprise to the investor, and, consequently, to bring about the very great economy of decreased cost of capital and the resultant fixed carrying charges." |
Tags
Toelichtingen
Geef een Toelichting voor NIVRAHA149_00782
