DESCRIPTIVE LIST OF EXHIBITS INTRODUCED AT HEARING ON DECEMBER 20, 1934 Commercial exhibit no. 6201.-Report by Randolph K. Ogle (F. T. C.) on examination of accounts and records of Cities Service Power & Light Co. (subsidiary of Cities Service Co.), together with lists of text tables and exhibits, covering (p. 113): Summary. Organization, control, and scope of operations in 1930. Growth of assets and liabilities. Growth of capital liabilities. Income, surplus, and return on investment. Consolidated balance sheet and income statement of Cities Service Power & Light Co. and subsidiaries for the year ended December 31, 1930. List of text tables. List of exhibits: Chart of companies controlled by Cities Service Power & Light Co. Combined balance sheet of companies acquired from Cities Service Co. as at June 30, 1924. Combined statement of earnings of certain companies, after giving effect to adjustments on interest charges, preferred dividends, and charges for Federal taxes to conform to the refinancing of certain of these companies which has taken place between June 30 and November 1, 1924. Balance sheets as at December 31, 1924, to 1930. Income statement. Analysis of surplus. Summary analysis of earnings receivable accrued for the years 1924 to 1930, inclusive. Summary analysis of surplus acquired for years ended December 31, 1924, to 1930, inclusive. Summary analysis of surplus reserve acquired. Summary analysis of earnings receivable reserve for the years 1924 to 1930, inclusive. Summary analysis of surplus reserves, 1924 to 1930, inclusive. Reconciliation of the balances of earnings receivable reserve and surplus reserve, years 1924 to 1930, inclusive. Summary analysis of bond discount and expense. Average total investment and rate of return, unrevised. Average total investment and rate of return, revised. (Tr. 45738.) IX UTILITY CORPORATIONS BEFORE THE FEDERAL TRADE COMMISSION IN THE MATTER OF INVESTIGATION OF PUBLIC UTILITY CORPORATIONS MAIN HEARING ROOM, FEDERAL TRADE COMMISSION, Met, pursuant to notice, at 10 a. m. Before Millard F. Hudson, examiner. Appearances: Col. William T. Chantland, counsel; Thomas J. Tingley, associate counsel; and Col. William H. England, associate chief economist, on behalf of the Commission. Robert Burns, 60 Wall Street, New York City, and W. B. S. Winans on behalf of Cities Service Co. Bernard F. Weadock, New York City; William J. Hagenah, Chicago, Ill.; and Martin V. Callagy, New York City. Examiner HUDSON. You may proceed. Mr. TINGLEY. If Your Honor please, we wish to take up this morning a report on the examination of the accounts and records of the Cities Service Power & Light Co., a subsidiary of Cities Service Co., the report having been made by Mr. Randolph K. Ogle, an examiner of the Commission. I will call Mr. Ogle to the stand. Examiner HUDSON. Has this witness been sworn, Mr. Tingley? Mr. TINGLEY. Have you been sworn heretofore, Mr. Ogle? Mr. OGLE. Yes. RANDOLPH K. OGLE was recalled as a witness on behalf of the Commission and, being previously duly sworn, testified further as follows: Further direct examination by Mr. TINGLEY: Question. Mr. Ogle, your qualifications are already a matter of record in these proceedings, are they not? Answer. Yes, sir. Question. To your knowledge, did the Federal Trade Commission. undertake an examination of the accounts and records of the Cities Service Power & Light Co.? Answer. Yes, sir. Question. By whom was that examination made? Answer. It was made by me. Question. When did you undertake the examination? Answer. I undertook the examination, I think, in January or Feb ruary of 1933. 1 Question. As a result of that examination did you prepare a report on the examination of the accounts and records of the Cities Service Power & Light Co.? Answer. I did. Question. What period does that report cover, Mr. Ogle? Answer. That report covers from the organization of the company, as of June 30, 1924, to December 31, 1930. Question. I hand you herewith a volume entitled, "Report on Examination of Accounts and Records of Cities Service Power & Light Co.", by Randolph K. Ogle, and ask you if that is the original of the report in question? Answer. It is. Mr. TINGLEY. I ask that that be received in evidence and marked with the appropriate exhibit number. (There was a discussion off the record.) Examiner HUDSON. If there is no objection, the exhibit will be received and given a number, as part of the case. (The document referred to was received in evidence, and was marked "Commission's Exhibit 6201, Witness Ogle.") By Mr. TINGLEY: Question. Mr. Ogle, that report is prefaced by the usual note explaining the scope of the Commission's investigation, is it not? Answer. Yes, sir. Question. It is also prefaced by a table of contents, is it not? Question. Occupying how many pages? Answer. The table of contents occupies 8 pages. Question. And it is also prefaced by a list of exhibits covering Question. And it is also prefaced by a summary, is it not? Question. Of how many pages does that summary consist? Question. Mr. Ogle, turning to the page marked "1" of your report entitled "Chapter 1, Organization, Control, and Scope of Operations in 1930, Section 1, Organization and Control", when was Cities Service Power & Light Co. incorporated? Answer. Cities Service Power & Light Co. was incorporated November 3, 1924, under the laws of Delaware. Question. What was the authorized capital stock and how was it divided as between classes of stock? Answer. The authorized capital stock consisted of $80,000,000, divided into 100,000 shares of first preferred stock, 50,000 shares of second preferred stock, and 650,000 shares of common stock of a par value of $100 per share. Question. What character of company was Cities Service Power & Light Co.? Answer. The company was organized as a holding company. Question. For what purpose? Answer. To acquire from the Cities Service Co. all of that company's holdings of common stock of electric utility companies and substantially all of its holdings of common stock of gas and electric railway utilities. Question. As of the last date covered by your report, who owned the common capital stock of Cities Service Power & Light Company? Answer. The entire common capital stock, except directors' qualifying shares, is controlled by Cities Service Co., which owns directly 92.5 percent, while its wholly owned subsidiary, Central Ohio Gas & Electric Co., owns the remaining 7.5 percent. Question. Do you know whether the situation still obtains as to the percentage, Mr. Ogle? Answer. It does. Question. Are the company and its subsidiaries under the supervision of any other company? Answer. Yes, sir. Question. What is that? Answer. The company and its subsidiaries are under the supervision of Henry L. Doherty & Co. Question. And who are they? Answer. They act as fiscal agent for the Cities Service Power & Light Co., and in that capacity receive and disburse all funds in connection with the financial operations of the company and account to it for all receipts and disbursements made in its behalf. Question. How are they compensated? Answer. It is claimed by representatives of the company that no profit or commissions accrue to the fiscal agent for the services it renders as such. Question. What statement is made by company representatives in that connection? Answer. Company representatives state that that is a fact and they also state that subsequent to December 31. 1930, all funds belonging to the Cities Service Power & Light Co. are carried in commercial banks in its own name. Question. What comment have you to make as to the officers and directors of the Cities Service Power & Light Co.? Answer. The officers and directors of Cities Service Power & Light Co. are, for the most part, identical with those of Cities Service Co. Question. Who is the president of both companies? Answer. Henry L. Doherty is president of both companies. Question. What comment can be made as to the other officers of the Cities Service Power & Light Co.? Answer. The other officers of the company are paid employees of Henry L. Doherty & Co. Such staff is maintained by the fiscal agent and the cost of such maintenance is charged by the fiscal agent to Cities Service Power & Light Co. each month. Question. Who is the fiscal agent? Answer. Henry L. Doberty & Co. Question. Your report contains a chart marked "Exhibit No. 1", showing the subsidiary companies owned or controlled by Cities Service Co. as of December 31, 1930, does it not? Answer. It does. Question. Where does that chart appear in your report? |