Harvey Mann
CONCORDIA UNIVERSITY, MONTREAL

ACCOUNTING FOR LES FORGES DE SAINT-MAURICE

Abstract: From a capital budget, an operating budget and a partnership agreement prepared almost 250 years ago in New France, a cash Budget and balance sheets are prepared to help in an analysis of the viability of the company. This investiga-tion into the feasibility of the project discloses a quite sophisticated use of man-agerial accounting. The original partnership failed, but eventually the company became a successful venture.

Accounting played a prominent role in the establishment of Les Forges de Saint-Maurice between 1730 and 1736. This is illustrated by a capital budget and an operating budget, prepared to support a request for a much-needed loan. In this paper, after an opening balance sheet is drawn up from various bits of data, the two budgets are examined and recast into more traditional forms. They are then analysed to ascertain whether decisions might have been different if present day techniques had been used. To aid in the conclusions drawn, recourse is made to an agreement between the partners. Other parts of this agreement are also examined for their accounting content. Using all the information, a new balance sheet is then prepared. It is possible to conclude that mistakes were made that may have been avoided if all the proper questions had been asked, but there is no doubt that the original concept was very sound.

Background

European explorers were first lured to North America by hopes of gold and other exotic riches, but it wasn’t until 200 years after Jacques Cartier sailed up the St. Lawrence River that a more prosaic, but more useful, metal was mined and worked in New France.1 This venture, Les Forges (ironworks) de Saint-Maurice,

*A great deal of original research on Les Forges de Saint-Maurice has been done by Cameron Nish, Professor of History at Concordia University, Montreal, Canada, and a leading authority on the ironworks. Although liberal use has been made of his work, it must be emphasized that the author is responsible for errors of translation and any interpretations of the data was started in 1730 a few miles from Three Rivers, a town half-way between Montreal and Quebec City. Although this was the first major manufacturing enterprise in New France, it was, by no means, the first in North America. This distinction is borne by a smaller venture established about 90 years earlier at Saugus, near Boston, Massachusetts,2 approximately 400 miles southeast of Three Rivers. Several reasons can be given to explain why Saugue was started only 20 years after the first settlers arrived, while it took almost 10 times as long for a similar attempt in New France. Differences in population growth,3 reasons behind the emigration from the old countries, the “Puritan Ethic” versus exploitation,4 harsher weather conditions, longer trade routes, and the needs and attitudes of the mother countries5, were all contributory factors. More important for the purpose of this paper, however, was that the American undertaking was “private enterprise”, while the French enterprise required government approval at every step. This bureaucracy may have hampered industrial growth but does offer some compensations for accounting historians, since a great deal of the early information on Les Forges is available from letters of government officials and state documents that have survived in archives on both sides of the Atlantic.6 The Saugus story, on the other hand, had to be gleaned from court records, which, actually, only tell the seamier side of the operation.

The Beginnings

The first faltering steps towards the eventual establishment of Les Forges de Saint-Maurice were taken in 1730 by a Montreal merchant, François Poulin de Francheville. He requested a 20-year monopoly from the State for the purpose of setting up an ironworks. This request was quickly granted by Gilles Hocquart, the Intendant (director), who was anxious to develop the colony and needed iron for a shipbuilding project near Quebec City. More important, de Francheville, as a true entrepreneur, did not initially ask for a subsidy or any government grant, very unusual at that time. He did, however, ask for help in recruiting experienced forgemen. This request was readily granted by the Crown, which sent two artisans from France at its own expense. By 1732, ore samples had been tested from the proposed site of the ironworks at the seignory (estate) of Saint-Maurice, with excellent results. By the end of that year, however, de Franceville realized that he had underestimated the magnitude of the project. He had spent £9,244.9s.5d7 about one-third of his capital, and the forge was nowhere near ready for

Mann: Accounting for Les Forges De Saint-Maurice 1730 -1736 65

operation. To spread the risk and obtain additional capital, de Francheville decided to form a company and to involve others in the project. At the same time, he asked the French government for a loan of £10,000. The new company was set up with 20 shares, worth 1s each, de Franceville keeping 10 shares for himself. The other partners being:
Pierre Poulin—De Francheville’s brother and a Quebec City merchant François—Etienne Cugnet—a director of Domain d’Occident (western land), a member of the Superior Council of the colony, and shortly thereafter, first counsellor Bricault de Valmur—Hocquart’s secretary, and lgnace Gamelin—the son of a Montreal fur trader.

The price of the seignory to the company was fixed at £6,000, but this amount did not have to be paid as long as payment of £300 per annum was made. (This is being interpreted as an open-end mortgage at 5%.) In April, 1733 the loan of £10,000 was granted by the government. From the data given in the previous paragraph it is possible to prepare the following opening balance sheet of the company.
Les Forges de Saint-Maurice
Opening Balance Sheet
April 1733

Assets Liabilities and Capital
Cash £ 10,001 Loan payable — State £10,000
Land 6,000 Loan — de Francheville 9,244.9s.5d.
Construction in progress 9,244.9s.5d. Mortgage @ 5% 6,000
Capital — partners 20s
£25,245.9s.5d. £25,245.9s.5d.

With the new infusion of capital, the construction of the forge progressed favourably, but unfortunately de Francheville fell sick and died in November, 1733. As can be expected, this complicated matters considerably, particularly since the government loan had been granted to de-Francheville personally. Hocquart asked Cugnet to take over the operation and early in 1734 there was finally some production. The iron, however, turned out to be of poor quality and the forgemaster, who had been brought over from France as an expert, confessed that he didn’t have the required skills to run the ironworks.

By this time, £21,483 had been spent on the undertaking and there was uncertainty about the source of further funds. Although details are not available, it must be assumed that this £21,483 consisted of the £10,000 from the government, £9,244 as originally spent by de Francheville, with the balance of £2,239 coming from the five partners. In spite of this setback, Hocquart was convinced of the feasibility and desirability of the project. He asked the French government to find two new master forgemen. One, François-Pierre Oliver de Vézain was persuaded to come to the colony by a bonus of £1,200 plus an annual salary of £2,400, exorbitant payments for that time. Another master ironworker, Jacques Simonnet, was also influenced to join the operation by the promise of an equal share in the venture. Although Hocquart was prepared to abandon the Saint-Maurice site and lose the total investment, de Vézain felt, after a detailed survey, that the best available location had been chosen, even though it would be necessary to scrap most of the existing facility. By late 1735, de Vézain had prepared a detailed estimate of the capital costs necessary to set up a proper ironworks, as well as an operating budget.

The Capital Budget

The capital budget, shown in translation as Appendix A, is quite sophisticated, although in some places, the format makes it a little difficult to follow. To alleviate this difficulty, the following condensation has been prepared.

Les Forges de Saint- Maurice
Capital Budget To prepare project for operations

Furnace
Stonework £6,253.6s.8d.
Housing and sheds 1,200
Bellows, equipment & tools 2,100
Canal, drains, etc. 1,500
Coke shed 1,200
Total , cost for furnace £12,253.6s.8d.
Stone crusher and washhouse 600.0 .0
Forge (Refineries, boilerhouse & workshop)
Stonework £1,300.0. 0.
Frame & covering 2,000
Outhouses 600
4 ovens 820
Equipment & tools 5,830

Mann: Accounting for Les Forges De Saint – Maurice 1730-1736

Canal, drains, etc. 2,000
Coke bunker 1,200
Blacksmith shop 1,100
Total cost for forge 14,850.0. 0.
Moulds, cauldrons and other cast iron 1,000.0.0.
Packhorses (16) 2,400.0.0.
Forgemaster’s house 4,000.0.0.
Storehouse, stable & oven 900.0.0.
Total estimated cost of project £36.003.6s.8d

The capital budget seems to have enough detail and preciseness to permit a reconstruction of the furnace and all the other trappings even today. A few of the amounts are calculated to the dinari but generally they appear in round figures. Later overruns proved many of the items to have been underestimated. It is obvious, from the budget, that the ironworks would be part of a “company” town. Included in the estimate was a home for the forgemaster listed at £4,000, over 10% of the whole construction cost, while facilities for the workers were already on site from the earlier construction. A later account, by a visitor to the ironworks, painted a glowing picture of the master’s house, calling it the “grande maison des forges”.8 A foundry was also provided for, but the amount of £27,976.13s.4d. was not included in the budget, since it was not to be built until a definite market exisited for its products. A hint of possible future problems is discernible at the end of the report where mention was made of some extraordinary work that would be required, but without any dollar amount being given. The total estimated cost for the ironworks including the forgemaster’s house, but omitting the foundry and the extraordinary work was £36,003.6s.8d.

The Operating Budget

As previously indicated, an operating budget was also prepared, see Appendix B. This was not in traditional form and profit was not computed although revenues were estimated. The expenses were grouped by work centers, under cast iron production, refineries and boilerhouses and foundry, but foundry expenses were not included in the total. The plan was to work the mill for only eight months in the year initially, since the refineries as projected could not accommodate a full year’s production of cast iron from the furnace. By the same token, the market for cast iron was unknown, and the limited operation would prevent a large surplus of this material. It would seem that an eight month operating period was a prudent decision because the severe winter conditions in the area would tend to impede operations and increase costs.

The operating budget is recast below, following an income statement format:
Les Forges de Saint – Maurice
Estimated Income Statement for One Year
Based on eight months production
Sales:
200,000 Ibs. @ £200/1000 (local) £40,000
400,000 Ibs. @ £140/1000 (France) 56,000
100,000 Ibs. iron objects @ £200/1000 (local) 20,000 £116,000
Cost of Sales:
Raw material
Iron ore £ 6,000
Coke 34,400
Limestone 1,000
Soil & grease 650 42,050
Direct labor
Furnace wages 6,800
Refining wages 9,700
Smelting wages 2,700 19,200 61,250
Gross profit £ 54,750

Several shortcomings are obvious in this budget. As the budget indicated, factory expenses such as depreciation and maintenance were not covered, nor does there seem to be any provision for selling and administrative expenses. The partnership agreement does, however, shed some light. The two “working” partners, Olivier and Simonnet, were to get salaries of £3,000 and £1,500 per annum, and these amounts were included in Direct Labor in the budget. Cugnet and Gamelin were expected to manage the affairs of the company in Quebec City and Montreal, respectively, without remuneration until the business became sufficiently extensive. It is further stipulated that all other operating expenses such as ad-ministrative, selling, transport, clerical and general costs were to be met by the company and deducted before any profit sharing. No estimates were provided, however, and it is impossible to arrive at a reasonable profit estimate.

Also worthy of note was the differential pricing being recommended. This type of pricing can be justified in the circumstances. The iron shipped to France would have to compete with that produced by the local French works and with imports from Spain and Sweden. Conversely, transport costs from Europe to New France would tend to bring the actual selling price in the colony up much higher, no doubt close to the price quoted.

Cash Budget
From the information presented in the two estimates, it is possible to prepare a cash budget. There is no record of this having been done, but it is deemed important since the de Francheville’s death, the financing would have to be undertaken by Cugnet and the others.
Les Forges de Saint-Maurice
Cash Requirements
To construct ironworks and for first year of operations (Based on estimates of 1735-36)
Cash required for building of ironworks £ 36,003
Cash required for eight months’ production 61,250
Payment due to Mrs. de Francheville, etc. 9,244
Current requirements £106,497
Payment due for seignory £ 6,000
Loan payable to State 10,000 16,000
Total cash requirements £122,497

Even though this cash budget was prepared from the known in-formation, certain assumptions had to be made. There was no indication of when the payment to Mrs. de Francheville and the former partners had to be made. The position taken was that this was a current liability, due immediately. The payment due for the seignory was definitely postponable, subject to a rental charge of £300 per annum. This payment can, therefore, be omitted from the budget, but is included for the sake of completeness. The situation is similar for the £10,000 loan from the State. As indicated in the partnership agreement, the partners had underwritten this loan. They subsequently asked the government for a deferment, which was granted. Although it is tempting to use hindsight with the amount for the construction of the ironworks, the estimate is accepted as given. This figure has to be considered as the best available information a t the time.

A more debatable amount is the cash requirement for the initial production. This has been shown as £61,250, the amount of the estimate for 8 months operation, with no provision for cash inflow from income. The line of reasoning taken here was that since the ironworks had not as yet gone into production:

1. Time was required to complete the facilities.
2. There was bound to be some undetermined start-up cost.
3. Initial production would tend to be slow as the labor force became familiar with work rules.
4. Production would also tend to be slowed by the debugging and malfunction of the new, unfamiliar equipment.
5. No provision was made for working capital. There would, of necessity, a time lag between

i Production

ii Building up of inventory

iii Sales

iv Transport of merchandise to customers

v Collection of receivables

For all these reasons, it has been decided to show the first year operating cost as a cash requirement without any offsetting sales revenue.

It is obvious that the principals had made a similar, but possibly more optimistic projection, because they asked the State for an ad-ditional loan of £100,000. If one considers all the factors at the time of the request, this amount sounds reasonable and more than adequate to complete the ironworks and start the operations. It can also be assumed that some of the partners, particularly Cugnet and Gamelin did have other resources. And once over the hurdle of the capital outlay and the start-up of production, on the basis of the projections, the cash flow would have been very good indeed.

The government seemed to have agreed with the plans by granting the loan in the form of a drawing account against the Treasury of the Navy. Aside from any other considerations, the time-frame for repayment of the loan was relatively short. With the original loan of £10,000 plus the new one of £100,000, and anticipated profit of £54,750, a payback period of a little over two years was possible under ideal conditions, once the mill was in operation. An added incentive to a quick repayment of the loan was the clause in the partnership contract that required reimbursement to the Crown before any distribution of profits.

The Contract 9

The new partnership agreement was signed on October 16, 1736 by Cugnet, Gamelin, Olivier, Simonnet and Thomas Jacques Tas-chereau, Councillor of the Supreme Council of Quebec and Treasurer of the Navy. At contract date, drawings against the loan had already mounted to £42,970, and a note was signed by the partners in favor of the Crown for £52,970, which included the original £10,000.10 From the contract, there is no doubt that a partnership was being formed, with unlimited liability and personal involvement, but with provisions for partners to disperse of their shares. It would seem that even though the corporate form of enterprise was well-known at this time,11 no attempt was made to acquire this privilege.
The contract raises another matter of interest to accountants. When discussing possible separation of a partner from the business, reimbursement was to be by way of taking an inventory. No further information was given specifying how this is to be done, but this method was in keeping with the accepted accounting practice of that time.12 Balance sheets were not drawn up on a regular basis, but when required, an inventory of all assets was taken and the net worth of the business was this total less the liabilities. Davis, discussing this method in 1888, accepts cost price, replacement cost at time of inventory and estimated value for damaged goods as permissible valuation Bases13 — shades of current value accounting! Nevertheless, it would have seemed wise for the contract to specify the method to be used to avoid future disagreements.

Also of interest to accountants is the prescribed formula for dividing profits and losses. The following information is pertinent:

1. Profits and losses to be divided in proportion of original investments, i.e. Taschereau — 10%; others — 221/4% each.
2. Olivier to receive £3,000 and Simonnet £1,500 per annum after all other expenses have been deducted, but these salaries are not to be considered administrative expenses. Each is responsible for his portion of the other’s salary.
3. Other, non-listed, administrative expenses to be met by company and to be deducted before division of profit.
4. Reimbursement of loans from Crown before any pro fit shared.

As long as the net profit exceeded the salaries to Olivier and Simonnet and the administrative expenses, the division of profit would present no difficulty.

This is shown below, based on the estimated income statement.
Gross Profit (after salaries to Olivier and Simonnet) £ 54,750
Less: Administrative expenses (estimate) 24,750
30,000
Add: Salaries to Olivier and Simonnet 4,500
Profit to be divided £34,500
Divided as follows:
Olivier (£3,000 plus 221/2% of £30,000) £9,750
Simonnet (£1,500 plus 221/2% of £30,000) 8,250
Taschereau (10% of £30,000) 3,000
Cugnet (221/2% of £30,000) 6,750
Gamelin (221/2% of £30,000) 6,750 £ 34,500

Note: None of these profits, beyond the £4,500 in salaries, could be withdrawn until the loan from the government had been repaid.

A Balance Sheet

From the various bits of information in the contract and other data accumulated, it is possible to prepare the following opening balance sheet as at the date of the new partnership.
This balance sheet reveals that the partnership was starting out in a negative position, because of the commitments undertaken from the previous business. The partners’ expectations, though, must have been very high, because they knew when they signed the contract that a good part of the original construction was useless. It can be argued that the partners’ risk was minimal with the government putting up the £100,000, but there was unlimited personal liability and all the loans had to be repaid before any drawings could be made. It will be seen in the following brief summary of the subsequent history of Les Forgas that one partner, at least, had anticipated too much.

Mann: Accounting for Les Forges De Saint – Maurice 1730 -1736 73
Les Forges de Saint- Maurice
Opening Balance Sheet
October 16, 1736

Assets Liabilities
Cash on hand £ 1 Loans payable — previous
Land 6,000 partners £ 9,244
Construction in progress Note payable — State (note 2) 52,970
(note 1) 42,970 Due re seignory (note 3) 6,000
£ 68,124
Partners’ equity
Opening capital £ 1
Accumulated deficit (19,244) (19,243)
£48,971 £ 48,971

Note 1 There may have been value attributable to part of the con-struction completed by the previous partnership. Any amount so determined would increase the “construction in progress” and decrease the “accumulated deficit”.

Note 2 The company was authorized to draw an additional £57,030 from the Treasury of the Navy against construction costs and operating expenses. This loan was repayable before any drawings by partners, other than salaries to Olivier and Simonnet.

Note 3 A rental of £300 per annum was payable until this liability had been paid.

Aftermath

Les Forges de Saint-Maurice did finally start producing in 1738, but costs escalated and sales did not meet projections. This re-sulted in a takeover of the ironworks by the government in 1741 and the personal bankruptcy of Cugnet in the following year. The other partners, however, were able to dispose of their personal property and seem to have gotten off scot-free. Eventually, however, Gamelin and Olivier settled with Cugnet’s estate. The govern-ment operated Les Forges until 1759, at which time it fell under British military control for several years. The property was then leased to various tenants who met with varying degrees of success. During the years 1793-1846 the lease was held by Mathew Bell, who it seems worked the mill very profitably.14 Les Forges was then sold to other private interests who continued to operate until 1883. During the almost 150 years that the ironworks were in existence, they experienced good times and bad, but they did supply the iron products needed in Canada. It has also been shown in a recent scientific study of some iron castings from the mill that the level of its production was of the highest quality.

There may be areas for further research in the records of Les Forges de Saint-Maurice, particularly for the period under French control. It may even be possible to do some analysis on actual costs and production as compared to the estimates given herein, but this will have to await further translation and study. Unfortunately, records after the French era are very sketchy and may have been lost forever.

Concluding Remarks

This paper has illustrated a capital budget and an operating budget prepared almost 250 years ago, using methods which compare very favorably with those used today. The available documentation does not carry the analyses to the same depth as it would at the present time, but the estimates seem to have been adequate for the purpose. Using the figures available, a cash budget and a balance sheet were prepared that might have aided the partners in their decision- making, if they had been prepared originally. But it must be realized that this was a capital – intensive enterprise being built for the first time in a young colony with inexperienced management and labour. Even today cost overruns and financial failures are not unknown in spite of the sophisticated techniques and costly analyses performed, so it is difficult to be too critical. Also bear in mind that in spite of government support, according to the partnership agreement, all the partners staked their all in this venture, not being able to hide behind the corporate veil.

It is worthy of note that the concept of the ironworks was sound. Once into production, the mill was successful with profits being very high in some years. And most important, for almost 150 years, Canadian needs for high quality iron products were supplied by Les Forges de Saint- Maurice.

“Projected expenses to be incurred in setting up and operating the ironworks in Canada”, A.P.C., Series C11 A, Canada, the St. Maurice Forges, vol. 11 0, tome 1, pp. 323-334.

Mann: Accounting for Les Forges De Saint- Maurice 1730-1736 75
Firstly
Set up costs.
Construction of the furnace.
For the furnace structure, 26 feet square by
28 feet high including the foundations, with a
capacity of 871/3 cubicfathoms(1), at £50 per
cubic fathom, the sum of 4366.13.4
For the large hanging each 20 ft in
breadth by 2 ft. thick and 11 ft. high, on four
walls, making 244/9 square fathoms at £16 per
square fathom 391. 2.3
For the small hangings each 10 ft. in breadth
by 11/4ft. thick and 11 ft. high on four walls,
making 122/9 square fathoms at £16 per square
fathom 195.11.1
10,000 bricks for the walls at £40 per
thousand 400
For the fire bricks for the inside walls of
the furnace 600
The pipes to keep the wall of the furnace
dry 300
Total for the stonework 6253. 6.8
The housing for the furnace over the crucible
opening, to shelter the bellows and hoists; this
being 35 ft. long and 20 ft. high, covered and
roofed with layers of planks and wooden
tiles, this 600
The furnace shed, covering the moulds 30 ft.
wide, 30 ft. long and 20 ft. high, with walls
and roof of layer upon layer of planks and
wooden tiles, this 600
The furnace bellows 800
The blast-pipe, grease and flues 300
The furnace equipment comprising wheels,
pulleys and lanterns 600
For the pokers and other tools 400
For the canal, drains, flagstones and
waterways 1500
Shelter for the coke used in the furnace, 60 ft. long, 40 ft. wide, with a frame 10 ft. high supported by stakes and covered over
1200 12253. 6.8. 12253. 6.8.

76

The Accounting Historians Journal, Spring, 1979

For a stone crusher and washhouse for the
iron ore, with wheel and machinery 600
Forge comprising two refineries, a boilerhouse, a metal workshop with all its tools, as well as weights for the hammers and mechanical presses.
The shelter for the forge, 90 ft. long by 40 ft. wide and 15 ft. high, whose frame is covered with layer upon layer of planks and wooden tiles.
For the stonework, 10 ft. high including
the foundations, and 3 ft. thick making 1081/3
sq. fathoms at £12 per fathom 1300
For the frame and covering 2000
For the outhouses on either side of the
shelter, where the mill wheels are kept, 90
ft. long by 10 ft. wide and 10 ft. high, sup
ported by stakes covered over with planks
and wooden tiles 600
Four ovens: two for the refinery, one for the boilerhouse and one for the metal workshop, each with stonework at the base 8 ft. square and 11/4 ft. thick, including the foot thick foundations, with their chimneys 30 ft. tall and 1 ft. thick at the base, becoming narrower from the base to the opening at the top, only 11/4 ft. square.
Forthe stonework of each oven, each 102/3
fathoms, making in all 422/3 square fathoms
at £12 per fathom 512
Forthe chimneys, each 62/3 square fathoms
making in all 252/3 square fathoms at
£12 per fathom 308 820
For the four pairs of bellows
and trimmings 1000
For the tuyeres, grease and flues 400
For the cast iron wedges used in operations 100
For the pokers, tongs and other tools 600
For equipment for the four ovens, consisting
of axles and wheels 1200
For the hammer weights 1000
For the cast iron hammer 500
For the cast iron anvil 100
For the cords and pivots of the axle of the
mechanical hammer 200
For the weights of the mechanical press 500
For the wrought iron hammer 200
For the cast iron anvil 30

Mann: Accounting for Les Forges De Saint – Maurice 1730 – 1736

77

For the canal, with its drains, flagstones
and waterways 2000
The coke bunker 60 ft. long by 40 ft. wide beneath the frame supported by pickets and covered over with planks and wooden tiles 1200
A blacksmith’s shop, 15 ft. square by 8 ft. high, covered with layer upon layer of planks

1100
1000
and wooden tiles 300
For the bellows 200
For the anvil 400
For the forge and chimney 100
For the tools 100 14850
For the molds, cauldrons and other cast: iron objects
Foundry for fashioning all kinds of iron objects (2)
The shelter, 36 ft. wide and 15 ft. tall,
covered over with layer upon layer of planks
and wooden tiles 2400
Two outhouses to shelter the wheels, 20 ft.
long by 10 ft. wide and 15 ft. high supported
by pickets covered over with planks and
wooden tiles 150
Forthe 322/g square fathoms of stonework
under the wheels at £12 per fathom 386.13.4
For the wheels, pulleys and lanterns,
wheel axles, chains and pivots 900
For the pulley components and the outhouses with all the necessary tools and iron ware 500
For the canal, drains, flagstones and
waterway 1000
An oven designed to heat the iron to be
molten with reflected heat: 15 ft. long, 12 ft.
wide, 12 ft. tall including the foundations and 1 %
ft. thick, with its roof of 20 square fathoms at
£12 per fathom 240
For the wire netting and cast iron 340
covers 100
A blacksmith’s shop similar to the
one at the forge, this 1100
For a beam 100 1300
For files and other tools 100

14850

78 The Accounting Historians Journal, Spring, 1979
For the house for the founder and his
four workers 1000
7976.13.4
Sixteen packhorses for construction work
and carts, at £150 each 2400
A house for the forgemaster, 40 ft. square by 20 ft. high, with two storeys, lattices, plastered inside and outside and walled with
planks and wooden tiles 4000
A storehouse to keep the irons, 30 ft. square by 8 ft. high, walled with layers of
planks and wooden tiles 550
A stable 250
An oven 100
36003. 6.8.

This preliminary outline does not include the house where the smiths and workers will be lodged, because the house already standing at St. Maurice will be used. The other buildings cannot remain in place, as they are standing on the ground needed for the buildings which are part of this project. The materials may be used. Its value is not entered in the present statement, as this will come under extraordinary expenses which were not foreseen when composing this preliminary outline, such as excavation of roads and other work.
Unsigned

(Olivier de Vézain?)

(1) The word translated here is Toise – fathom, which is 6 feet.
(2) The item included here is not entered, as the foundry will be
set up only when there is a guaranteed market for the iron in
the form of iron thongs and other various kinds of foundry
products. (This note appears in the left margin of the manu
script.)

Translation Appendix B

“Annual operating expenses”, A.P.C., Series C11 A, Canada, the Saint Maurice Forges, vol. 110, tome 1, pp. 335-339.
The furnace could be worked all year round, producing 1600 thousandweights of cast iron, of which only 900,000 Ibs. could be used in the two refineries, to produce 600,000 Ibs. of pig iron. Thus, 700,000 Ibs. of cast iron would remain. As the extent of the market is not yet known, the project should be reduced to eight months of

Mann: Accounting for Les Forges De Saint-Maurice 1730-1736 79
work, producing 1,000,000 Ibs. of cast iron, 900,000 Ibs. of which would be used in the refineries, leaving 100,000 Ibs. over to be used in making cast iron objects for use here in the Colony.
For 1,000,000 lbs. of cast iron, the requirements are:
2000 barrels(1) of iron ore at £3 per barrel brought to the furnace, this 6000 20,000 barrels of coke to be brought to the furnace at 20s the barrel 20000 1000 barrels of limestone at 20s

per barrel 1000
600 barrels of sandy soil at 20s 600
100 of candle grease at 10s 50
£ 27650
wages
A forge master 3000
A clerk 700
A founder 1500
A Junior founder 400
Four labourers at £300 each 1200
£ 6800 £34450
The 1,000,000 Ibs of cast iron will come to the same amount at a rate of £34.9s per thousand. This expense is not entered here because it will be carried below as an expense of the refineries and the smelting operation.
Expenses of the refineries and boilerhouses
900,000 Ibs. of cast iron at 34.9s per thousand 31005
55105
14400 barrels of coke at 20s per barrel 14400

Wages £45405
A hammersmith (2) 1200
Three boilermen at £600 each 1800
A boilerhouse helper 300
A refiner 1200
Seven refinery employees 9700
at £600 each 4200
A carpenter 500
A blacksmith 500
£551 05

80 The Accounting Historians Journal, Spring, 1979
The pig iron will come to £91.16s10d per thousand.
Smelting expenses.
1000 thousandweights of cast iron at £34.9s
per thousand 3445
Wages
A moulder 1500 2700 6145
Two labourers at £600 each 1200
£6145
£61250
Foundry expenses (3)
Wages
A founder 1500
Four workmen at £300 each 1200
2700
Output of the above forges. Output of the refineries and boilerhouses.
600,000 Ibs. of pig iron of which the following to be consumed by the colony:
200,000 Ibs at £200 per thousand 40000
400,000 Ibs. will be sent to France at 96000
600,000 Ibs. £140 per thousand 56000
Output from smelting.
100,000 Ibs. in the form of pans, slabs, cauldrons and
other cast iron objects which will be used in the
Colony at £200 per thousand 20000
£116000
Unsigned
(Olivier de Vézain?)
(1) The word translated here is Pipe—a variable measure of cap
acity, used especially in measuring liquids. Here: barrel
(2) These workmen will work in the metal workshop when neces
sary. (This passage appears in the left hand margin of the
manuscript).
(3) This expense is not entered, as the foundry will be set up only
when there is a certain market for foundry irons of various
kinds. (Note appears in the left margin of the manuscript).

FOOTNOTES

1 New France, during the early 18th century, covered a vast territory entending to the Gulf of Mexico. Most of this area, however, was very sparsely populated so that New France, as used in this paper, is only that narrow band of land along the St. Lawrence River, now part of the Province of Québec.

2 For the story of this operation, see Hartley, passim.

3 See Historical Statistics, series Z1 — 19, and Seventh Census, pp. 134-8. 4See Hartley, chap.
4, And Eccles, chap. 5.
5 Hartley, p. 22.

6 This material has been collected and published by Nash, primarily in French. Although considerable reference has been made to his research, the interpretations and analysis of the material, in this paper, are of a different nature and are examined from the perspective of an accountant rather than an historian.

7 The monetary units used are libri (£), solidi (s) and dinari (d). 12=1s, 20=1 £ (Note the British usage of £.s.d. for pounds, shillings and pence.) It is difficult to convert this amount into current dollars; some indication of its value can be perceived from the wages shown in the operating budget, which range from £300— 600perannum.

8 Wurtele, p. 81. The literal translation of this phrase is “big house of the iron-works” but the connotation is that of “mansion”.
9 To conserve space, the translation of this document is not included in this paper. It is available to anyone interested in the details.
10 Nish, Cugnet, p. 62.
11 See the classic work by Davis, Corporations.
12 Gordon, p. 59.
13 Davis, J. D., p. 5.
14 Wurtele, p. 87.
15 Miller, pp. 48-9.
16 The two translations, from the Old French, were made by Ms. Sheila A. Cush-ing, following Nish in L’Actualité Economique.

BIBLIOGRAPHY

Davis, J. D. Manual of Standard Bookkeeping, Montreal: John Lovell and Son, 1888.
Davis, John P. Corporations, New York: Capricorn Books, 1961.
Eccles, W. J. The Canadian Frontier 1534-1760, New York: Holt, Rinehart and Winston, 1969.
Gordon, William, The Universal Accountant and Complete Merchant, London: Alexander Donaldson,1777
Hartley, E. N. lronworks on the Saugus, Norman: University of Oklahoma Press, 1957.
Historical Statistics of the United States, Washington: US. Department of Com-merce, 1960.
Miller, Harry, Canada’s Historic First lron Castings, Ottawa: Queen’s Printer, 1968.
Nish, Cameron, François-Etienne Cugnet 1719-1751: Entrepreneur et Entreprises en Nouvelle-France, Montreal: La Corporation des Editions Fides, 1975.
, “La Banqueroute de François-Etienne Cugnet, 1742: Ill. Cugnet et
les Forges de Saint-Maurice (1)”L’Actualité Economique vol. 41, no. 4, janvier-mars1966, pp. 762-810.
Seventh Census of Canada, 1931 vol. 1 Summary, Ottawa; J. O. Patenaude, I.S.O., 1936.
Wurtele, F. C., “Historical Record of the St. Maurice Forges, the Oldest Active Blast Furnace on the Continent of America” Proceedings and Transactions of the Royal Society of Canada, vol. iv, sect. 2, 1886, pp. 77-89.