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Section 24 of Kenya Railways Corporation Act CAP 397: Principles of operation

    

(1) It shall be the duty of the Corporation to conduct its business according to commercial principles and to perform its functions in such a manner as to secure that, taking one year with another, its gross revenue is not less than sufficient to meet its outgoings which are properly chargeable to revenue account including proper allocations to the general reserve and provisions in respect of depreciation of capital assets, pension liabilities, and interest and other provision for the repayment of loans, and further to ensure that, taking one year with another, its net operating income is not less than sufficient to secure an annual return on the value of the net fixed assets in operation by Corporation of such a percentage as the Minister may direct from time to time.
(2) For the purposes of subsection (1)—
(a) “net operating income” shall be determined by subtracting from gross operating revenue all operating and administrative expenses including adequate provision for maintenance and depreciation but excluding interest and other charges on debt;

“value of the net fixed assets in operation” shall be the gross value of those assets less the amount of accumulated depreciation shown in the statement of accounts of the Corporation:
Provided that, if the amounts shown in the statements of accounts do not reflect a true measure of the value of the assets concerned because of currency revaluations, changes in prices or similar factors, the value of the fixed assets shall be adjusted adequately to reflect such currency revaluations, changes in prices or similar factors.
(3) In the exercise of its duty under subsection (1), the Corporation may, subject to any directions of a general nature which may be given to the Board by the Minister responsible for finance, invest moneys standing to the credit of the Corporation in such securities as the Board thinks fit.
(4) Notwithstanding the provisions of paragraph (e) of section 8(2), so far as is not inconsistent with the provisions of this section or with the principles of prudent finance, the Minister may, from time to time, in consultation with the Board, makes provision for cheap transport to be provided by the Corporation to assist agriculture, mining and industrial development in Kenya.

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