1936 Ben Graham.US Steel Announces Sweeping Modernization Scheme
An unpublished satire by Ben Graham, written in 1936 and given by the author to Warren Buffett in 1954.
Myron C. Taylor, Chairman of U. S. Steel Corporation, today announced the long awaited plan for completely modernizing the world's largest industrial enterprise. Contrary to expectations, no changes will be made in the company's manufacturing or selling policies. Instead, the bookkeeping system is to be entirely revamped. By adopting and further improving a number of modern accounting and financial devices the corporation's earning power will be amazingly transformed. Even under the subnormal conditions of 1935, it is estimated that the new bookkeeping methods would have yielded a reported profit of close to $50 per share on the common stock. The scheme of improvement is the result of a comprehensive survey made by Messrs. Price, Bacon, Guthrie & Colpitts; it includes the following six points:
U. S. Steel Corporation 董事长 Myron C. Taylor 今日宣布了一项期待已久的计划，旨在对这家全球最大工业企业进行全面现代化改造。出人意料的是，公司的生产或销售政策均不会有任何变动。相反，整套簿记系统将被彻底重组。通过采用并进一步完善若干现代会计与财务手段，公司的盈利能力将得到惊人的提升。估算显示，即便在1935年那种低迷的经营环境下，新的簿记方法也能使普通股每股报告利润接近50美元。这套改进方案是由 Price, Bacon, Guthrie & Colpitts 经过全面调研后提出的，包含以下六项内容：
1.Writing down of Plant Account to Minus $1,000,000,000.
将厂房资产账面价值减记至负10亿美元。
2.Par value of common stock to be reduced to 1¢.
普通股票面价值降至1美分。
3.Payment of all wages and salaries in option warrants.
所有工资与薪酬均以期权凭证支付。
4.Inventories to be carried at $1.
存货账面价值统一记为1美元。
5.Preferred Stock to be replaced by non-interest bearing bonds redeemable at 50% discount.
以无息债券取代优先股，该债券可按50%折扣赎回。
6.A $1,000,000,000 Contingency Reserve to be established.
设立10亿美元的或有准备金。
The official statement of this extraordinary Modernization Plan follows in full:
以下为这一非凡"现代化计划"的官方完整声明：
The Board of Directors of U. S. Steel Corporation is pleased to announce that after intensive study of the problems arising from changed conditions in the industry, it has approved a comprehensive plan for remodeling the Corporation's accounting methods. A survey by a Special Committee, aided and abetted by Messrs. Price, Bacon, Guthrie & Colpitts, revealed that our company has lagged somewhat behind other American business enterprises in utilizing certain advanced bookkeeping methods, by means of which the earning power may be phenomenally enhanced without requiring any cash outlay or any changes in operating or sales conditions. It has been decided not only to adopt these newer methods, but to develop them to a still higher stage of perfection. The changes adopted by the Board may be summarized under six heads, as follows:
U. S. Steel Corporation 董事会欣然宣布，经对行业形势变化所引发问题的深入研究，董事会已批准一项全面改造公司会计方法的综合计划。由特别委员会在 Price, Bacon, Guthrie & Colpitts 的协助与支持下完成的调研显示，本公司在运用某些先进簿记手段方面，相较于其他美国企业略显滞后——而正是借助这些手段，无需任何现金支出、无需任何经营或销售条件的改变，即可使盈利能力获得非凡提升。董事会决定，不仅要采纳这些更先进的方法，更要将其发展至更臻完善的境界。董事会通过的各项变更，可归纳为以下六个方面：
1. Fixed Assets to be written down to Minus $1,000,000,000.
固定资产减记至负10亿美元。
Many representative companies have relieved their income accounts of all charges for depreciation by writing down their plant account to $1. The Special Committee points out that if their plants are worth only $1, the fixed assets of U. S. Steel Corporation are worth a good deal less than that sum. It is now a well-recognized fact that many plants are in reality a liability rather than an asset, entailing not only depreciation charges, but taxes, maintenance, and other expenditures. Accordingly, the Board has decided to extend the write-down policy initiated in the 1935 report, and to mark down the Fixed Assets from $1,338,522,858.96 to a round Minus $1,000,000,000.
许多代表性企业已将其厂房账面价值减记至1美元，从而使损益账户完全免于任何折旧费用的负担。特别委员会指出，若其他企业的厂房仅值1美元，则 U. S. Steel Corporation 的固定资产实际上还不值这个数。如今已是公认的事实：许多厂房在现实中与其说是资产，不如说是负债，不仅带来折旧费用，还伴随着税款、维护及其他支出。有鉴于此，董事会决定延续1935年年报所开创的减记政策，将固定资产从1,338,522,858.96美元径直标记为负10亿美元整。
The advantages of this move should be evident. As the plant wears out, the liability becomes correspondingly reduced. Hence, instead of the present depreciation charge of some $47,000,000 yearly there will be an annual appreciation credit of 5%, or $50,000,000. This will increase earnings by no less than $97,000,000 per annum.
此举之优势不言而喻。随着厂房的损耗，这一负债将相应减少。因此，每年约4,700万美元的折旧费用将不复存在，取而代之的是每年5%、即5,000万美元的"增值收益"入账。如此一来，年度利润将提升不少于9,700万美元。
2. Reduction of Par Value of Common Stock to 1¢, and
普通股票面价值降至1美分，以及
3. Payment of Salaries and Wages in Option Warrants.
以期权凭证支付薪资与工资。
Many corporations have been able to reduce their overhead expenses substantially by paying a large part of their executive salaries in the form of options to buy stock, which carry no charge against earnings. The full possibilities of this modern device have apparently not been adequately realized. The Board of Directors has adopted the following advanced form of this idea:
许多企业通过以股票认购期权的形式支付高管薪酬的大部分，从而大幅削减了管理费用——此类期权不计入损益费用。这一现代手段的全部潜力，显然尚未得到充分挖掘。董事会就此采纳了如下更为进阶的方案：
The entire personnel of the Corporation are to receive their compensation in the form of rights to buy common stock at $50 per share, at the rate of one purchase right for each $50 of salary and/or wages in their present amounts. The par value of the common stock is to be reduced to 1¢.
公司全体员工的薪酬，将一律改以认购普通股的权利形式发放，认购价格为每股50美元，按照现有薪资或工资每50美元对应一份认购权的比例计算。普通股票面价值同步降至1美分。
The almost incredible advantages of this new plan are evident from the following:
此新方案近乎难以置信的优势，从以下几点即可一目了然：
A. The payroll of the Corporation will be entirely eliminated, a saving of $250,000,000 per annum, based on 1935 operations.
以1935年的经营规模为基准，公司薪资支出将被彻底消除，每年节省2.5亿美元。
B. At the same time, the effective compensation of all our employees will be increased severalfold. Because of the large earnings per share to be shown on our common stock under the new methods, it is certain that the shares will command a price in the market far above the option level of $50 per share, making the readily realizable value of these option warrants greatly in excess of the present cash wages that they will replace.
与此同时，全体员工的实际薪酬将增加数倍。由于新方法将使普通股呈现出极高的每股盈利，股价在市场上必然远超50美元的期权行权价，从而使这些期权凭证的可变现价值，远远超过其所取代的现有现金工资。
C. The Corporation will realize an additional large annual profit through the exercise of these warrants. Since the par value of the common stock will be fixed at 1¢, there will be a gain of $49.99 on each share subscribed for. In the interest of conservative accounting, however, this profit will not be included in the income account, but will be shown separately as a credit to Capital Surplus.
公司将通过期权凭证的行权额外实现一笔可观的年度利润。由于普通股票面价值固定为1美分，每股认购将产生49.99美元的收益。然而，出于稳健会计原则的考量，此项利润将不计入损益账户，而是单独列示为资本公积的贷方项目。
D. The Corporation's cash position will be enormously strengthened. In place of the present annual cash outgo of $250,000,000 for wages (1935 basis), there will be annual cash inflow of $250,000,000 through exercise of the subscription warrants for 5,000,000 shares of common stock. The Company's large earnings and strong cash position will permit the payment of a liberal dividend which, in turn, will result in the exercise of these option warrants immediately after issuance which, in turn, will further improve the cash position which, in turn, will permit a higher dividend rate -- and so on, indefinitely.
公司的现金状况将得到极大改善。以1935年为基准，原本每年2.5亿美元的工资现金支出，将被转变为通过500万股普通股认购权行权所带来的每年2.5亿美元现金流入。公司丰厚的盈利与强健的现金状况，将支撑慷慨的股息派发；股息派发反过来将促使期权凭证在发行后立即被行权；行权又将进一步改善现金状况；现金状况改善又将支撑更高的股息率——如此循环，无穷无尽。
4. Inventories to be carried at $1.
存货账面价值统一记为1美元。
Serious losses have been taken during the depression due to the necessity of adjusting inventory value to market. Various enterprises -- notably in the metal and cotton-textile fields -- have successfully dealt with this problem by carrying all or part of their inventories at extremely low unit prices. The U. S. Steel Corporation has decided to adopt a still more progressive policy, and to carry its entire inventory at $1. This will be effected by an appropriate write-down at the end of each year, the amount of said write-down to be charged to the Contingency Reserve hereinafter referred to.
经济萧条期间，由于必须将存货价值调整至市价，公司蒙受了严重损失。金属及棉纺织等行业的诸多企业，已通过将全部或部分存货以极低单价入账的方式，成功化解了这一难题。U. S. Steel Corporation 决定采取更为进取的政策，将全部存货的账面价值统一记为1美元。具体做法是在每年年末进行相应减记，减记金额冲抵下文将述及的或有准备金。
The benefits to be derived from this new method are very great. Not only will it obviate all possibility of inventory depreciation, but it will substantially enhance the annual earnings of the Corporation. The inventory on hand at the beginning of the year, valued at $1, will be sold during the year at an excellent profit. It is estimated that our income will be increased by means of this method to the extent of at least $150,000,000 per annum which, by a coincidence, will about equal the amount of the write-down to be made each year against Contingency Reserve.
此新方法所带来的益处极为显著。它不仅将彻底消除存货跌价的一切可能，更将大幅提升公司年度盈利。年初账面价值仅为1美元的存货，在年内出售时将呈现出极为丰厚的利润。据估算，此方法每年将为公司增加至少1.5亿美元的收益——巧合的是，这一数字与每年冲抵或有准备金的减记金额大致相当。
A minority report of the Special Committee recommends that Accounts Receivable and Cash also be written down to $1, in the interest of consistency and to gain additional advantages similar to those just discussed. This proposal has been rejected for the time being because our auditors still require that any recoveries of receivables and cash so charged off be credited to surplus instead of to the year's income. It is expected, however, that this auditing rule -- which is rather reminiscent of the horse-and-buggy days -- will soon be changed in line with modern tendencies. Should this occur, the minority report will be given further and favorable consideration.
特别委员会的少数派报告建议，出于一致性原则并获取类似优势，应将应收账款与现金亦一并减记至1美元。此提案目前已被否决，原因在于审计师仍坚持要求：凡已如此冲销的应收账款与现金若获收回，须贷记盈余而非计入当年收益。然而，预计这一颇具"马车时代"遗风的审计规则，将很快顺应现代潮流而有所变革。一旦如此，少数派报告将获得进一步的积极考量。
5. Replacement of Preferred Stock by Non-Interest-Bearing Bonds Redeemable at 50% Discount.
以可按50%折扣赎回的无息债券取代优先股。
During the recent depression many companies have been able to offset their operating losses by including in income profits arising from repurchases of their own bonds at a substantial discount from par. Unfortunately the credit of U. S. Steel Corporation has always stood so high that this lucrative source of revenue has not hitherto been available to it. The Modernization Scheme will remedy this condition.
近期经济萧条期间，许多公司得以将以大幅折扣回购自身债券所产生的收益计入损益，从而抵消经营亏损。遗憾的是，U. S. Steel Corporation 的信用评级向来极高，这一颇为丰厚的收益来源迄今与公司无缘。此次现代化方案将弥补这一缺憾。
It is proposed that each share of preferred stock be exchanged for $300 face value of non-interest-bearing sinking-fund notes, redeemable by lot at 50% of face value in 10 equal annual installments. This will require the issuance of $1,080,000,000 of new notes, of which $108,000,000 will be retired each year at a cost to the Corporation of only $54,000,000, thus creating an annual profit of the same amount.
方案提议将每股优先股兑换为面值300美元的无息偿债基金票据，该票据将以抽签方式在10年内按等额年度分期以面值50%赎回。此举需发行总额10.8亿美元的新票据，其中每年赎回1.08亿美元，而公司实际支出仅为5,400万美元，由此每年产生等额利润。
Like the wage-and/or-salary plan described under 3. above, this arrangement will benefit both the Corporation and its preferred stockholders. The latter are assured payment for their present shares at 150% of par value over an average period of five years. Since short-term securities yield practically no return at present, the non-interest-bearing feature is of no real importance. The Corporation will convert its present annual charge of $25,000,000 for preferred dividends into an annual bond-retirement profit of $54,000,000 -- an aggregate yearly gain of $79,000,000.
与上文第3条所述的薪资方案如出一辙，此安排将同时令公司与优先股股东两蒙其利。后者可获保证，其现持股份将在平均五年内以票面价值150%的价格得到清偿。鉴于当前短期证券几乎毫无收益可言，无息这一特征实无关宏旨。公司将把现有每年2,500万美元的优先股股息支出，转化为每年5,400万美元的债券赎回利润——每年合计净增收益7,900万美元。
6. Establishment of a Contingency Reserve of $1,000,000,000.
设立10亿美元或有准备金。
The Directors are confident that the improvements hereinbefore described will assure the Corporation of a satisfactory earning power under all conditions in the future. Under modern accounting methods, however, it is unnecessary to incur the slightest risk of loss through adverse business developments of any sort, since all these may be provided for in advance by means of a Contingency Reserve.
董事们深信，上述各项改进措施将确保公司在未来任何情形下均能维持令人满意的盈利能力。然而，在现代会计方法之下，任何不利的业务发展所带来的哪怕丝毫损失风险，均无需承担——因为这一切皆可通过设立或有准备金而预先加以拨备。
The Special Committee has recommended that the Corporation create such a Contingency Reserve in the fairly substantial amount of $1,000,000,000. As previously set forth, the annual write-down of inventory to $1 will be absorbed by this reserve. To prevent eventual exhaustion of the Contingency Reserve, it has been further decided that it be replenished each year by transfer of an appropriate sum from Capital Surplus. Since the latter is expected to increase each year by not less than $250,000,000 through the exercise of the Stock Option Warrants (see 3. above), it will readily make good any drains on the Contingency Reserve.
特别委员会建议公司设立规模颇为可观的10亿美元或有准备金。如前所述，每年将存货减记至1美元的差额，将由该准备金予以吸收。为防止或有准备金最终耗尽，另行决定每年从资本公积中转入适当金额加以补充。鉴于后者预计将通过股票期权凭证的行权，每年增加不少于2.5亿美元（见上文第3条），足以轻松弥补或有准备金的任何消耗。
In setting up this arrangement, the Board of Directors must confess regretfully that they have been unable to improve upon the devices already employed by important corporations in transferring large sums between Capital, Capital Surplus, Contingency Reserves and other Balance Sheet Accounts. In fact, it must be admitted that our entries will be somewhat too simple, and will lack that element of extreme mystification that characterizes the most advanced procedure in this field. The Board of Directors, however, have insisted upon clarity and simplicity in framing their Modernization Plan, even at the sacrifice of possible advantage to the Corporation's earning power.
在设立此安排之际，董事会必须遗憾地承认，对于各大重要企业在资本、资本公积、或有准备金及其他资产负债表科目之间大额转移所惯用的种种手法，他们未能更进一步加以改良。事实上，不得不承认，我们的账目处理将略显过于简单，缺乏这一领域最先进操作所特有的那种高深莫测之感。然而，董事会在拟定现代化计划时，始终坚持清晰与简洁的原则，纵使因此牺牲了公司盈利能力上可能的进一步提升。
In order to show the combined effect of the new proposals upon the Corporation's earning power, we submit herewith a condensed Income Account for 1935 on two bases, viz:
为呈现上述新方案对公司盈利能力的综合影响，现提交以两种口径编制的1935年简明损益账户，具体如下：
In accordance with a somewhat antiquated custom there is appended herewith a condensed pro-forma Balance Sheet of the U. S. Steel Corporation as of December 31, 1935, after giving effect to proposed changes in asset and liability accounts.
依照一项略显陈旧的惯例，兹附上 U. S. Steel Corporation 截至1935年12月31日、经拟议资产与负债账户变更调整后的简明备考资产负债表。
*Given a Stated Value differing from Par Value, in accordance with the laws of the State of Virginia, where the company will be re-incorporated.
*根据公司将重新注册所在地 Virginia 州的法律，申报价值与票面价值有所不同。
It is perhaps unnecessary to point out to our stockholders that modern accounting methods give rise to balance sheets differing somewhat in appearance from those of a less advanced period. In view of the very large earning power that will result from these changes in the Corporation's Balance Sheet, it is not expected that undue attention will be paid to the details of assets and liabilities.
或许无需向各位股东特别指出，现代会计方法所产生的资产负债表，在外观上与较不先进时期的报表存在若干差异。鉴于上述资产负债表变动将为公司带来极为可观的盈利能力，预计各方不会对资产与负债的细节给予过分关注。
In conclusion, the Board desires to point out that the combined procedure, whereby plant will be carried at a minus figure, our wage bill will be eliminated, and inventory will stand on our books at virtually nothing, will give U. S. Steel Corporation an enormous competitive advantage in the industry. We shall be able to sell our products at exceedingly low prices and still show a handsome margin of profit. It is the considered view of the Board of Directors that under the Modernization Scheme we shall be able to undersell all competitors to such a point that the anti-trust laws will constitute the only barrier to 100% domination of the industry.
最后，董事会希望指出：厂房以负值入账、薪资支出彻底消除、存货在账面上几近于零——上述措施的综合运用，将赋予 U. S. Steel Corporation 在行业中举足轻重的竞争优势。我们将能够以极低的价格出售产品，同时仍呈现出丰厚的利润率。董事会经审慎研判认为，在现代化方案之下，我们将能够以低价全面压制所有竞争对手，以至于反垄断法律将成为实现行业百分之百主导地位的唯一障碍。
In making this statement, the Board is not unmindful of the possibility that some of our competitors may seek to offset our new advantages by adopting similar accounting improvements. We are confident, however, that U. S. Steel will be able to retain the loyalty of its customers, old and new, through the unique prestige that will accrue to it as the originator and pioneer in these new fields of service to the user of steel. Should necessity arise, moreover, we believe we shall be able to maintain our deserved superiority by introducing still more advanced bookkeeping methods, which are even now under development in our Experimental Accounting Laboratory.
在发表上述声明之际，董事会并非没有意识到：部分竞争对手或将试图通过采用类似的会计改进手段来抵消我方的新优势。然而，我们深信，U. S. Steel 将凭借其作为这些服务于钢铁用户新领域之开创者与先驱者所积累的独特声望，持续赢得新老客户的忠诚。此外，若形势有此必要，我们相信，公司将能够通过引入更为先进的簿记方法来维护其当之无愧的领先地位——此类方法目前已在我们的会计实验室中付诸研发。
热门主题
Recent Articles
1936 Ben Graham.US Steel Announces Sweeping Modernization Scheme
An unpublished satire by Ben Graham, written in 1936 and given by the author to Warren Buffett in 1954. Myron C. Taylor, Chairman of U. S. Steel Corporation, today announced the long awaited plan for completely modernizing the world's largest ...2026-02-28 Greg Abel VS Warren Buffett
Greg Abel VS Warren Buffett 1、同一个主题的表述 有一段针对保险业务的评论可以测试两个人在思维方式上的差异。 （1）Greg Abel Refer To：《2026-02-28 Greg Abel's Letters to Berkshire Shareholders》。 Reinsurance Group Our reinsurance operations face similar dynamics. The reinsurance sector has ...2026-02-28 Greg Abel's Letters to Berkshire Shareholders
Refer To：《2026-02-28 Greg Abel's Letters to Berkshire Shareholders》。 To My Fellow Berkshire Shareholders, Warren Buffett is arguably the greatest investor of all time, with generations benefiting from his investment acumen. He has also been a ...1989-02-28 Warren Buffett's Letters to Berkshire Shareholders
Refer To：《1989-02-28 Warren Buffett's Letters to Berkshire Shareholders》。 To the Shareholders of Berkshire Hathaway Inc.: Our gain in net worth during 1988 was $569 million, or 20.0%. Over the last 24 years (that is, since present management took ...1991-03-01 Warren Buffett's Letters to Berkshire Shareholders
Refer To：《1991-03-01 Warren Buffett's Letters to Berkshire Shareholders》。 To the Shareholders of Berkshire Hathaway Inc.: Last year we made a prediction: “A reduction [in Berkshire’s net worth] is almost certain in at least one of the next three ...