THE FEILDING FARMERS' FREEZING CO., LTD.

NZ Truth, Issue 882, 21 October 1922, Page 13

THE FEILDING FARMERS' FREEZING CO., LTD.

Eighth Annual Report and Balance" Sheet. It seems to "Cambist" that it is a mistake to call the above company by its trading name, for, on looking through the accounts, one quickly perceives that the real owner of the business is the Union Bank of Australia, judging by the huge amount of money, that is owing £o that institution. Wherever we turn nowadays we hear and read wondrous : sermons preached by the banks on the need of economy and the impossibility of lending money to promote wealth development. What are we to think - when we findi that the Feiiding Farm- ' ers' Freezing Company, lAa., have only an authorised capital of £150,000 m £1 shares, of which only 75,489 shares are taken up after eight years had run their course, and that only £48,738 was paid up at date of the balance-sheet now under notice? What are we to think when we notice that the i Union Bank allowed these people to pay themselves an S per cent, dividend last year? Is it prudent for the company \o borrow from a bank £109,758? Yet that is the amount of the ad-vances made , by the Union to this babe m the freezing industry, m addition to- which are advances against consignments £77,954. In the latter case some meat jobber from dear old London may be 'hidden at the back of this entry. To sum up this side of the balance-sheet, the total of outside creditors make up £188,673 m all, or, say, £140,000 more than the, paid-up capital of ..the company, In the opinion of "Cambist 1 ' this is somewhat reckless business. As regards the bank it will no doubt be fully protected by the usual guarantee, and that is why it does not call up the advance and get .the'money m. While the bank temporises with a business like- this dozens of small worthy settlers are being DRiyEN^ FROM THEIR HOMES because they are harci pressed for the means to carry. on with. Of course, if the banks are bolstering up big men and using, depositors' money for that purpose, there; can be very little left for the aid of smaller persons on the land. . - TTie first item on the assets side of this balance-sheet proves the reckless sort of ideas which rule the management. The land, builaings, plant and machinery are put ctown at £131,382, and that latter .sum gives , some indication of what it V costs to establish a freezing venture. Compare such* figuz-es with those of the paid-up capital. Does it. not 'look like a Tiuge gamble? Consignments unrealised, £91,525, and stocks and material, £11,296, make up the other chief assets on this side of the balance- sheetThe profit and loss account shows that the business has been losing money, for it started with £4967 m hand and closed with only £911. , The directors "had pleasure" m handing this out to the shareholders and s , of course, there was no dividend. What a beauty for the Union Bank to nurse, or will the bank insist upon the guarantors doing the. nursing stunt themselves? ' . •