V. GENERAL EXPENSES.

106. SALARIES AND EXPENSES OF GENERAL OFFICERS.

Salaries.-Add: "Commissions paid to land and tax commissioners in lieu of sal

aries.''

(For interpretation of this account see Cases 82, 209, 246, 255, 2nd 262, Accounting Bulletin No. 1.)

107. SALARIES AND EXPENSES OF CLERKS AND ATTENDANTS.

No change.

[39

(For interpretation of this account see Cases 82, 246, and 262, Accounting Bulletin No. 1.)

108. GENERAL OFFICE SUPPLIES AND EXPENSES.

No change.

(For interpretation of this account see Case 35, Accounting Bulletin No. 1.)

109. LAW EXPENSES.

Add: "Cost of membership in associations the object of which is to protect roads in respect to litigation concerning the use of patents.'

(For interpretation of this account see Cases 287 and 310, Accounting Bulletin No. 1.)

"This account includes all premiums made or paid by a carrier to its insurance fund, and premiums (except reinsurance premiums) paid by it to insurance companies for insuring buildings and other structures, equipment of all classes, other property, and persons against loss, damage, or injury by fire, accident, or other causes. Notes A and B remain as at present.

(For interpretation of this account see Cases 29, 31 and 182, Accounting Bulletin No. 1.)

111. RELIEF DEPARTMENT EXPENSES.

112. PENSIONS.

No change.

No change.

(For interpretation of this account see Cases 208 and 302, Accounting Bulletin No. 1.)

113. STATIONERY AND PRINTING.

No change.

(For interpretation of this account see Cases 154 and 155, Accounting Bulletin No. 1.) [40

Add: "Donations to local fire departments; cost of exchange on checks cashed or deposited and drafts bought; cost of draping stations."'

(For interpretation of this account see Cases 113, 207, and 313, Accounting Bulletin No. 1.)

115.

GENERAL ADMINISTRATION JOINT TRACKS, YARDS, AND TERMI-
NALS-DR.

No change.

(For interpretation of this account see Case 295, Accounting Bulletin No. 1.) 116. GENERAL ADMINISTRATION JOINT TRACKS, YARDS, AND TERMINALS-CR.

No change.

(For interpretation of this account see Cases 285 and 295, Accounting Bulletin No. 1.)

[41

CLASSIFICATION

OF

OPERATING EXPENSES

AS PRESCRIBED BY THE

INTERSTATE COMMERCE COMMISSION

FOR

STEAMROADS

IN ACCORDANCE WITH

SECTION 20 OF THE ACT TO REGULATE
COMMERCE

THIRD REVISED ISSUE CONDENSED

EFFECTIVE ON JULY 1, 1908

At a General Session of the INTERSTATE COMMERCE COMMISSION, Held at its Office in Washington, D. C., on the 1st Day of June, 1908.

[Figures in brackets on right-hand side of pages indicate folios of original issue.]

The subject of a Uniform System of Accounts to be prescribed for and kept by carriers being under consideration, the following order was entered:

It is ordered, That the Classification of Operating Expenses issued under order of June 3, 1907, and designated as Third Revised Issue, as amended by the Supplement thereto prescribed by order of June 1, 1908, be, and the same is hereby, modified for the use of Small Carriers as hereinafter defined; that such modified Classification embodied in printed form to be hereafter known as Third Revised Issue, Condensed, a copy of which is now before this Commission, be, and the same is hereby, approved; that a copy thereof duly authenticated by the Secretary of the Commission be filed in its archives, and a second copy thereof, in like manner authenticated, in the [5 office of the Division of Statistics and Accounts; and that each of said copies so authenticated and filed shall be deemed an original record thereof.

It is further ordered, That the term "Small Carriers' shall include carriers doing principally a switching or a terminal business, and also carriers doing a general transportation business that operates a mileage of 250 miles or less and have annual operating revenues not in excess of $1,000,000, provided they are independent of the control of any operating carrier not embraced in the above definition.

It is further ordered, That all the provisions contained in the said order of June 3, 1907, and all rules prescribed by that order for the keeping and recording of operat ing expense accounts as expressed in the text of the primary accounts contained in said Third Revised Issue and all the provisions contained in the said order of June 1, 1908, and all rules prescribed by that order in the Supplement to the Third Revised Issue, shall apply to Small Carriers, excepting only that Small Carriers are, by virtue of this order, authorized to reduce the number of primary accounts kept by them: Provided, however, That the primary accounts so kept shall conform to the list of primary accounts contained in the Third Revised Issue, Condensed (so far as the primary accounts contained in said list pertain to the business carried on by such carrier), or to the subdivision of such accounts as hereinafter next provided.

It is further ordered, That the terms of the order of June 3, 1907, relative to the subdivision of primary accounts, or to assignments of amounts charged or credited to any primary account to operating divisions, to individual lines, or to states, or to the keeping of temporary or experimental accounts shall apply to Small Carriers [6 that elect to use the condensed Classification of Operating Expenses: Provided, however, That any permanent subdivision of a primary account shall conform to the primary accounts or groups of such accounts prescribed for large carriers for which provision is made in the Classification of Operating Expenses, Third Revised Issue. It is further ordered, That Small Carriers that elect to use the condensed classification shall file in the office of the Division of Statistics and Accounts notice of their election to do so, but that nothing in this order shall be construed as requiring any carrier to change in the keeping and recording of accounts of operating expenses from the condensed classification to the extended classification, except at the close of a fiscal year ending on the thirtieth of June.

It is further ordered, That July 1, 1908, be, and is hereby, fixed as the date on which the Third Revised Issue, Condensed, shall become effective.

[7

INTRODUCTORY LETTER.

To Carriers Concerned:

Interstate Commerce Commission,
Division of Statistics and Accounts,
Washington, June 16, 1908.

The first revised issue of the Classification of Operating Expenses took effect July 1, 1894, and the second revised issue became effective July 1, 1901. The third revised issue, which is now in force, dates from July 1, 1907. Certain modifications of the latter classification are embraced in a Supplement to the Third Revised Issue, which will become effective July 1, 1908.

All the above classifications were designed primarily to meet the requirements of large operating roads. The classification herewith promulgated, which is designated "Third Revised Issue, Condensed," is prepared for the use of small carriers; that is to say, for terminal and switching companies and for companies operating a mileage of 250 miles or less and having annual operating revenues not in excess of $1,000,000, with the exception, however, that small roads which are not independent of the control of any operating carrier included in the class of large carriers are required to keep their accounts and records of operating expenses in conformity with the rules and requirements prescribed for large roads. This classification is designed for small and independently operated roads.

The Classification of Operating Expenses herewith issued is a condensation of the classification prescribed for large roads. This is made clear by the manner in [9 which the classification is presented, it being in the form of a comparative statement of the condensed and the extended classification. In the right-hand column will be found the primary accounts provided for large carriers so arranged as to indicate the manner in which the extended classification is condensed for the use of small carriers; the primary accounts in the left-hand column are those prescribed for small carriers. It will be observed from this comparative statement of the two classifications that provision is made in the condensed classification for a single "Equipment-Renewals' account and a single "Equipment-Depreciation" account, which accounts correspond respectively to the renewal and the depreciation accounts for the several classes of equipment in the extended classification. The rules and principles relative to renewal and depreciation accounts, however, are the same for both classes of carriers.

The number of accounts in this classification is forty-four, but it is not probable that any considerable number of the small carriers will find it necessary to maintain all the accounts named; many of the roads of this class doing a general transporta tion business, for example, will find no use for the primary accounts covering yard service, while, on the other hand, many switching and terminal companies will find no use for those that pertain to road expenses, or for the primary account No. 20 Traffic expenses." It is possible also that a considerable number of the carriers of this class will find no use for the joint-facilities accounts.

66

Henry C. Adams,

In charge of Statistics and Accounts. [10