8
(a)
unreasonable, excessive rates of return in the
past as is implicit in HMG advice;
(b)
reasonable rates of return combined with a past
failure to extract a community dividend.
Indeed, the cash balance may derive from a
combination of both.
4.2.3 As a test of the reasonableness of past rates of
return, post tax surpluses (excluding interest earned
and charged) were calculated and expressed as a
percentage of ANFA employed following the historic
cost accounting convention for the period 1972/73 to
1986/87. The results of this exercise are given in
Table 2 below. Prior to April 1972 adequate records
are unavailable but it is reasonable to assume that
returns are likely to fall gradually to negative
levels in common with the financial history of many
international airports.
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