Microfiche: Tough new kid on the data block;

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microricne TOUGH NEW KID ON THE DATA BLOCK
M-I-C-R-O-F-I-C-H-E. Microfiche.
Quite a word. On the first hearing it
might evoke an image of sub-miniature
French guppies cavorting in biological
research tanks, but in reality microfiche
is the name of an exciting new data
gathering system now in use in the re­search
department of the Executive
Office. Specifically, this new communi­cations
aid is intended to give practice
offices much broader coverage of the
financial activities of corporations as
revealed in annual reports and similar
filings with the Securities and Exchange
Commission.
This aid is one of the latest develop­ments
in microphotography, the tech­nique
of photographing and reproduc­ing
documents at a fraction of their
original size. It permits relatively easy
retrieval of information from a much
greater range of source materials than
the research department had been able
to accumulate in the past. And the in­formation,
of course, is in space-saving,
scaled-down form. It is much smaller,
in fact, than the older microfilm meth­ods
of storing records on 35mm reels or
code-indexed cards holding only a
single frame of film.
Microfiche (fiche means page in
French) is a means of transposing a
multi-page document—such as an an­nual
report to shareholders—onto one
small strip of film. The microfiche itself
is a four-by-six inch sheet of acetate
that can hold the negative images of up
to sixty pages of printed material-twelve
images across and up to five
rows deep on the sheet.
For ready identification, the micro­fiches
are neatly index tabbed, with the
name of the particular corporation and
the type of report printed clearly
against a background that is color
keyed as follows: orange—annual re­port
to shareholders; green—final pro­spectus;
red—registration statement;
white—Form 10K.
Principal Wally Wilson, working
with partners Cy Youngdahl and Jack
Crawford, was responsible for the re­search
that resulted in the Firm's de­cision
to adopt the microfiche system.
As Wally puts it, "With microfiche,
we've got the potential capability for
greatly improved information services
for clients who turn to the Firm for
insight into new or unusual corporate
accounting practices."
H&S offices often call on the Exec­utive
Office research department for
information on current accounting
practices of corporations in the same
industry as their clients. It is then the
research department's job to sift
through annual reports or other SEC
filings to screen out such things as, to
cite a typical example, how plastics
companies amortize research costs.
Previously research department staff­ers
had to hunt for such information
by going through a vast amount of
cumbersome printed material stashed
away in long rows of file cabinets. And
in spite of the huge amount of space
needed to store the source materials,
there was still a relatively limited range
of material on publicly owned com­panies
available to the research depart­ment's
files.
This picture began to change dra­matically
when the Firm subscribed to
a corporate microfiche service offered
by Leasco Data Processing Equipment
Corporation. Leasco,through an agree­ment
with the Securities and Exchange
Commission, photographs all SEC fil­ings,
prints them in microfiche form,
indexes and distributes them.
Through Leasco, our Firm now has
access to detailed information on as
many as 8,000 corporations. In addi­tion
to annual reports, Leasco furnishes
the Firm with final prospectuses, regis­tration
statements and copies of Form
10K for every company that is regis­tered
with the SEC. As a result, the
research department can now provide
the practice offices with a much
broader compilation of information
than was possible before.
To see how it all comes about, let's
look at the previously cited example—
the query for information on how plas­tics
manufacturers are amortizing re­search
costs. Unfortunately, Leasco
only recently began to code microfiches
by industry classification, so the re­search
department's alphabetical fifing
system still requires a degree of time-consuming
personal selection of mi­crofiches.
(Wally Wilson says that
automatic selection equipment is now
available and can be incorporated into
the system at some future date if the
work load warrants it.)
On a microfiche index supplied by
Leasco, a research department staffer
will find a list of perhaps eighty plas­tics
manufacturers, by company name.
He will then pull out each of the eighty
acetate fiches from the file of annual
reports—with each containing, page by
page, the full annual report for one
company — and run them through a
reader. The microfiche of the annual
report for XYZ Plastics Corporation,
for example, is inserted in the machine
as if it were a negative being placed
below the light of a photo enlarger. An
arrow-like indicator is moved to a
square on a grid that corresponds to
the page containing the desired infor­mation
and the page is projected onto
the back of a vertical, etched-plastic
screen. Right now the research depart­ment
has two such readers—a model
manufactured by a client, Micro-
Design, Inc., plus a reader-printer that
will produce xerographic copies.
By pulling data from the annual re­ports
of the eighty key corporations,
the research department staff can com­pile
information to be included in one
report sent to the inquiring office.
It is also possible to make copies of
the pertinent pages of an annual report
—or, of course, a final prospectus, regis­tration
statement or Form 10K—of any
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