ing its office to Hoboken and perhaps defying them, and the relief that can be obtained by creditor or stockholder against it has its severe limitations.

If the incorporators desiring to do business in New York are willing to brave its perils, they will incorporate under the New York laws, but if they are ambitious and wish to do business in other states, they must get the authority and submit to the jurisdiction of each state where they wish to carry on the business, and instead of having one master they have as many masters as there are states or territories to which their business extends. The requirements of each state are peculiar. The conditions are different and their responsibilties, civil and criminal it may be, are different. The present system seems to offer:

1. The maximum of protection for fraud;

2. The minimum of protection and convenience for honest dealing, and

3. The best of opportunity for small states and territories to fill their coffers with the proceeds of taxing outsiders, and the best chances for their petty public officials to get a good income without doing any work.

THE NECESSITY FOR CORPORATE ORGANIZATION.

We are living in an age of great things; things too great to be accomplished without co-operative effort. Production, transportation and distribution are now necessarily carried on on such a large scale that the resources and abilities of many men must be combined to secure a successful result. Besides, individual men die, and modern business affairs are too complicated to be passed through a probate court as often as men may die. The business of our country, to a greater and greater degree every year, must be done by its corporations which have the two requisites necessary for success, which the individual cannot have, the power of indefinite extension and combination and legal immortality.

The corporation has come to stay and is one of the most beneficent instruments of modern civilization.

THE NECESSITY FOR GOVERNMENT SUPERVISION. Corporations, however, have their abuses as well as their uses. They offer the opportunity for combination for evil as well as for good. They may be as potent to protect the wicked from responsibility for their sins as to protect the widow and orphan from the business mistake of the head of the family. They may adopt bad methods instead of good methods. They may be the instruments of fraud and wrong as well as the handmaids of modern civilization. It is for the state to step in and with firm and impartial hand, while giving them all the freedom that is necessary for the proper conduct of their business, to restrain them from using their corporate powers to accomplish wrong. The corporation as a servant of the state is an instrument of untold good. The corporation, as the state's master or the state's enemy, has a potency for untold evil.

THE NECESSITY FOR UNIFORM LEGISLATION IN RELATION TO CORPORATIONS.

There would seem to be no subject as to which uniformity is more desirable, for there is no subject more important to the well being of the state than the proper control of corporations, a control which shall impose the minimum of restraint upon lawful business and the maximum of restraint when corporate managers become public enemies. Our Conference has been instrumental in securing uniformity of legislation on commercial paper, but the evils which resulted from the diverse laws on this subject were infinitesimal compared with the evils that now confront us from the chaotic state of corporation legislation. We are asking the states to unify their marriage and divorce laws. The domestic relationship is indeed an important subject. The question of marriage and divorce is one that affects the home, but the evil that results from the difference in the laws

of the different states on the subject is perhaps quite as much sentimental as real, and the remedy that can be applied is much less trenchant and far-reaching in its effects than the remedy that can be applied in correction of the evil which we are now discussing.

We know of no subject to which this Conference of Commissioners on Uniform State Laws may devote themselves to better purpose than the subject of unifying, in so far as we can, the incorporation laws of our country-the laws on which so large a part of the business and the prosperity of our country depend.

THE REMEDY.

It is often easier to diagnose a disease than to prescribe a remedy. A complete and perfect remedy, perhaps, it is impossible to find, but it seems to your committee that much may be accomplished in the way of a remedy by wise legislation on the part of Congress and the legislatures of the several states and territories.

The first thing to be done, it seems to us, is to secure the passage by Congress of a National Incorporation Law, and to require that a corporation to carry on interstate commerce under the Constitution should conform to the provisions of the national law. We are of the opinion that the general principles of the law drafted and proposed by Professor Horace L. Wilgus, of the University of Michigan, are correct and that the passage of a National Incorporation Law on these lines would be wise legislation. The bill is very carefully drawn and contains adequate provisions for its enforcement and protects alike the honest corporation and the public.

The provisions of such a law would cover a large part of the larger corporations of the country. It should, in our judgment, be followed by legislation along similar lines by the separate states and territories. The same regulations which are wise as to interstate commerce would generally be equally wise as to commerce within a state. The same powers and the

same restraints would, generally speaking, work for good in the one case as in the other.

We have not thought it necessary or desirable that we should formulate such a law. Our present purpose is simply to indicate the necessity for it and the lines on which it should be drawn.

Respectfully submitted,

WALTER S. LOGAN,

Chairman.

REPORT

OF THE

COMMITTTEE ON A UNIFORM SYSTEM OF ACCOUNTING IN STATE AND MUNICIPAL AFFAIRS.

To the Conference of Commissioners on Uniform State Laws: The committee appointed at the Thirteenth Annual Conference of the Commissioners on Uniform State Laws, held at Hot Springs, Virginia, as a "Committee on a Uniform System of Accounting in State and Municipal Affairs, to confer with other bodies having this aim in view, and to report to this Conference at its next meeting," would respectfully report:

That the paper on "A Uniform System of Accounting in State and Municipal Affairs," read at the last annual Conference by Mr. L. G. Powers, Chief Statistician of the United States. Census Office, contained on pages 30 to 40 inclusive of the last annual report of this Conference, gave us a most learned and comprehensive statement "of the states which have statutes for such systems of accounting, the character of those statutes and some of the beneficial results following their adoption."

The committee having a grateful recollection of the forcible presentation of Mr. Powers in his paper, communicated with him and learned that: "The last year has seen but little accomplished in the way of positive legislation. Bills were introduced in the legislatures of the various states looking toward a uniform classification of accounts by such officers as state auditors or a uniform system of responsible accounting supervision by some public official." Mr. Powers had "not heard definitely from the bill in the State of Oregon," but the last that he heard was "that the bill would probably become a law." "The Tax Commission of Wisconsin had recommended the adoption of the Ohio law for uniform accounting. Numerous commercial bodies had also passed recommendations to the