by F. Corine Thompson and Richard L. Norgaard

Hardcover, dust jacket, 6" x 9", 86 pages, in near mint condition.

This book contains two separate and distinct studies relating to sinking funds. There is also an introduction which briefly describes the studies and indicates how they are related to each other.

The first study is entitled "Changing Patterns in Corporate Debt Retirement." It traces the historical evolution of the sinking fund from its inception to the present time and provides current statistical information on sinking funds. Some distinct and unusual conclusions come from the study. First, the sinking fund has become an extremely important part of long-term debt financing with approximately 90% of all debt issues, whether publicly or privately placed, containing some amortization features. Second, the terms of the sinking fund are stringent - more so than ever before in history. The study indicates that since 1933 the financial community has done an about face regarding its attitudes toward debt, and that the sinking fund is the outward manifestation of this attitude.

The second study is entitled "An Analytical Approach to Sinking Funds." It describes a set of evaluative procedures which can be used by issuers and lenders to determine whether or not a particular issue should have a sinking fund. A mathematical appendix is provided for those readers interested in actually applying the procedures. In this study a number of examples are used and from these it can be deduced that, in general, issuers of long-term debt should avoid sinking funds. Lenders, on the other hand, may or may not find sinking funds of benefit. The study indicates that sinking funds should be used far less than they are being used at present.