CO129-573-14 Kowloon-Canton railway- provision of a renewals fund 7-6-1938 - 11-10-1938 — Page 23

53932/38

Draft.

Gapelbeam 1938

Mr. Walker 5/8

NOTE

1..

ispare

the Quis despatct.

year's in para.

is very misleading.

Though

called "depreciation" reserve, the

6-8 present provision is really a renewal

Mr. Sent or Cowell 8

Is reserve

(calculated in a special way to avoid

large growth of balance) operating to

flatten out the cost of replacements

charged against railway revenues.

copyto CA 2

e.g. 1936

Depreciation charge (2%)

$58,457

less

Spa

New boiler (paid for out

expdre sub head 41

Head 26)

$30,970

other major

replacements

1,113

32,083

Net Credit to Reserve a/c

$26,374

Under this arrangement there

will not be 60 years at 1%.

2. The present method of providing for

Vie

renewals of rolling stock by Hak Railway

and Colony is as follows:

The Railway sets aside as a purely

of the founo's day.

paper credit the % shown in para. 2 and

debits