A report by one who by previous education and experience is competent to investigate the physical condition of a railroad, electric light, or such a property as he may be employed to report upon.

In purchasing at first hand from a corporation desiring to sell its obligations, it is customary to employ an expert engineer to report upon the physical condition of the property belonging to the corporation. Let us take, for example, a street railway whose bonds have been offered to a banker for purchase, and who has contracted for them subject to the usual conditions as to finding everything as represented. Among other experts, a competent engineer is employed to thoroughly examine the machinery, road-bed, ties, rails, overhead construction, rolling stock, etc., to find if it is thoroughly up-to-date and capable of fulfilling the demands likely to be placed upon it. In this regard, let the investor, among others, bear this point in mind: that the most favourable report from the best engineer in the country certifying to the conditions of this street railway does not argue that its bonds will prove to be a safe investment, because no matter how good a road is from a physical standpoint, there must be sufficient business to warrant its existence, and to provide for its proper maintenance as well as to safeguard the interest and principal of the bonds. It is better to have, perhaps, a poorly constructed road running through a section furnishing an enormous amount of business, which will provide earnings to not only safeguard the bonds, but enable the road to be later brought up to a proper physical condition, than it is to have the best road which engineers can construct running through a country with inadequate business tributary to it. See also last subject.

English Money Table:

4 farthings

=

1 penny

12 pence

=

1 shilling = 48 farthings

20 shillings

=

1 pound or sovereign = 240 pence = 960 farthings

21 shillings

=

1 guinea