In studying a language, we begin with the grammar before we try to read or write. In mathematics, we practice ourselves in simple arithmetic before we proceed to the subtleties of algebra and the differential calculus. But it is the grave misfortune of the moral and political sciences, as well shown by Mr. Herbert Spencer in his " Study of Sociology, " that they are continually discussed by those who have never labored at the elementary grammar or simple arithmetic of the subject.

To-day, everyone still believes himself competent to discuss corporation finance, which is a branch of political science, in the same cheerful ignorance of the fundamentals of the subject. Everything, therefore, which will help to throw light on the dark corners of finance and make ignorance less excusable should be welcome. Never have corporation managers been more sensitive to public opinion, and if charts in annual reports make the truth more easily grasped (which they do) they will soon command an established place in corporation records. /

This chapter is largely hased on an article prepared at the suggestion of the author by Mr. Pierpont V. Davis, of New York City, and published by Mr. Davis in Moody's Magazine.

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