SouthernRailway wrote: ↑Mon Jun 25, 2018 8:36 am
If I understand correct, Amtrak's accounting is non-GAAP and it allocates costs to LD trains and the NEC as it sees fit (i.e., Amtrak does its accounting any way it wants).
SouthernRailway wrote: ↑Sat Nov 05, 2016 3:47 pm
$10 million savings is Amtrak's made-up number: the same "accounting" that somehow creates profits for the Northeast Corridor. Under GAAP, Amtrak's numbers would look a lot different.
For the record, Ernst & Young, as Amtrak's auditor, says that management prepares its statements in conformity with GAAP (U.S. Generally Accepted Accounting Principles), which, frankly, is
as strong an assurance of being GAAP as one can get in this life, and has signed its audit saying so since at least 2013 (links further back are broken)
https://www.amtrak.com/reports-documents
The beef that people actually have is a question GAAP is silent on: the assignment of costs to the network, which is a "fight" that all transportation companies have. There is no one best answer to these questions. You may say you think they paint an unfair picture to a particular line of business, but there is not a basis for saying it is "phony"
Examples and then Amtrak:
These are not rhetorical questions...they absolutely have to be answered (or ruled out) by an accounting system. But they are also not possible to cleanly divide into "real" vs "phony"
Should the costs of an road-rail intermodal terminal be assigned by train, by railcar, by track, or by load? Assign it by train, and short trains look unprofitable. Assign it by load, and long trains won't get/report their economies of scale. How about revenues? How much of a double stack's revenues were earned by the terminal, the gondola, the locomotive, or the rails? Time of Day: Should only trains at peak times pay for "surge" capacity, and capacity be assumed to be "sitting there for free" the rest of the time? Should the cost of the gondola be its lease cost, depreciated purchase price, replacement value, or something else?
Should the costs of an airline hub be assigned by gate, by flight, by seat, or by passenger? Assign costs by gate and little planes look bad. Assign costs by passenger and big, full planes look relatively worse (and empty flights look great). Assign it by passenger dollar and emptier flights with high-fare customers and empty seats look pretty good. Then assign revenues between the segments flown and the connecting terminal. How do you assign the costs of the flight between First and Coach? By square inch? By pound (full or empty weight?) As a fixed % of revenue?
Should the costs of the NEC be assigned by train, by coach, by seat, or by passenger? Or how about by axle-mile-Newton (calculated to show heavier pounding by heavier and higher speed trains). Should only Acelas be assigned the costs of maintaining the highest track Class(es)? What is a fair estimate of how much more (really) the highest track costs? Should a train pay the high-Class premium if it only *could have* gone fast, or only if it actually *does* go fast. Or only for the stretches it matters (or that they actually "do" top-class speeds? How should the costs of Penn Station be assigned (and should they show a net subsidy to NJ & LIRR commuters?)
SouthernRailway wrote: ↑Mon Jun 25, 2018 8:36 am
If I understand correct, Amtrak...allocates costs to LD trains and the NEC as it sees fit (i.e., Amtrak does its accounting any way it wants).
If that's true, why can't Amtrak just allocate more sleeping car revenues to dining service and eliminate any dining losses by just allocating more sleeping car revenues to it?
Because a logical problem then arises: if you allocate too much of a fare to a particular amenity, you end up with the absurd proposition that the "plain old seat" in a Roomette is worth less than it'd be in coach, even though that seat is demonstrably larger&better.
Further, now that we have data from the Star, we actually know a lot better what the value of a Roomette-without-food is, which limits how much you can honestly say the diner food is worth. In fact, the average yield in paired Star/Meteor markets comes pretty close to telling you *exactly* what the Diner food is worth. (with a fudge for the factor of schedule, which is probably worth something too)