The Pamphlet Collection of Sir Robert Stout: Volume 84
In presenting to you the further Report on your Company's affairs, your Committee wish to state that they have as far as possible avoided personalities, and simply state the facts as they occurred.
After the Committee of Investigation had presented to you their Report on the position of the affairs of your Company, you expressed a wish that certain points should be more minutely examined and reported on.
The Allotment of Shares was one of the points, and you will see that the opinion of our Counsel gives hopes of your being able to attack Sir Julius Vogel on the subject of the allotment of shares to himself.page 2
We have thoroughly examined all the facts bearing on the compromised contract for the 4,000 Telephones, but in this case, as you will see, our Counsel does not hold out great hopes that any proceedings could be taken against your late Directors.
We have considered to what extent the assets of the Company necessitate a reduction of capital, and add a recommendation to that effect.
Certain alterations of the Articles of Association appear to us desirable, and they are laid before you.
We also submit an arrangement by which the control of your Company over the affiliated Companies, and the harmonious working of these different concerns, will be assured.
We recommend a Reduction of Directors' Fees in all the four Companies.
The letters which passed between your present and past Directors, referring to the latter's claims for fees, deserve your attention.
We finally add some remarks about the Staff of your Company, the legal expenses, and the settlement with the River Plate Telephone Company.
The adoption and passing of the Report and Accounts for the year ending 31st March, 1884, appears to us to be now desirable, and we think that a portion of the balance (£10,290 17s. 9d.), to the credit of the revenue account, might be used to write off certain items, such as depreciation of plant, bad debts, &c.
£7,050 of the above £10,290 17s. 9d. should not be dealt with as profit, because Mr. Grower was paid a far larger sum than that for the contract of the 4,000 Telephones.
This amount should go to the reduction of goodwill, &c.