Profits from Enhancement of Value

In the case of mining rights, there frequently arises a need for reappraisals on account of fresh deposits being found, or on account of improved facilities becoming available, which render possible or profitable the working of deposits not included in the original valuations. Such increases should, of course, be shown in the accounts, but the matter of revaluations must be approached in a conservative and fair-minded manner. These increases are frequently somewhat problematical, and any doubtful portion of the increase should be shown, not in the general Property account, but in a special reserve account opened for the purpose and finally disposed of either as a gain or as a loss, as the circumstances may determine.