The Democratic press. [volume] (Ravenna, O. [Ohio]) 1868-1901, 1892-06-29
AUDITING BOOKS AT NIGHT.
One Feature of Expert Accounting That
is Performed in Secret.

81 will venture the estimate" said
a well known public accountant re-
Gently, chat not one-half of the num-
ber of defalcations and thefts from
commercial and financial institutions
and business houses in the city are
ever made public.
Business men," he continued, "are
10th to admit that they have been vic
timized. They 90 on the theory that
publicity in such matters might injure
their credit. Consequently, unless the
amount is large, every effort is made
to keep the matter out of the court,
even though it entails some loss.
"The public have an idea that the
principal work of an expert account
ant comes in play in settling estates,
examining the books of corporations,
making Investigations for capitalists
who are about to invest money in busi-
ness ventures, opening up new books
and going over the books of instltu-
tions that have been robbed
"That is, however, but a small por-
ton of the work. What we call the
auditing feature of the business has
developed largely of late. The con-
duction of this reveals much that is
|
me to the assertion that not .one-half OF
the defalcations committed are made
public"
When asked for a complete explana
ton of the auditing feature the ac
countant said: Il will illustrate witt
a case that have just concluded.
"The books of a large wholesale
house were balanced by the Office
forces at the end of the year. The!
showed the profits to be far less thai
was expected. The partners had al
idea of forming stock company o
their business. They did not question
the integrity of their cashier, who hat
been with them many years. At tn
same time they were anxious to fin,
out if everything was going properl
in their office.
"They explained the circumstance
to me, and l proposed auditing thei
books and outlined the work.
amounts to nothing more or less tina
this: Every night after the office wa
closed the junior partner OF the fir
met two of my men who were specia
" detailed for the purpose, Togethe
they proceeded to the office, opene
the safe and worked until three o'cloc
in the morning.
"Every individual transaction of til
day was taken up and entered O
sheets of paper as though we were tt
clerical forces of the house. We nevt
made an entry on the books or a
tempted to check back from then
, For month we continued the wol
D without the knowledge of the cashi'
or his assistants.
a "The result was as | expected. v
d discovered an elaborate system of fall
3 entries by which the firm had been d
i. frauded for years. The cashier w
If taken to task, without being informt
h that his books had been audited. I
(, denied his guilt, threatened suits f
s. slander and assumed virtuous indi
nation. When the other set of boo
1, was shown him, however, he willie
n confessed the crime and pleaded +
1T mercy. AS he had been with the hou
50 for long time he was permitted
es resign, and l, of course, am pledg
~ to secrecy regarding his identity.
Il Il "That case" said the accountant
:. conclusion, "is but one of many whe
h a crime is hushed up, and" he adde
or chat wholesale house is not the or
e; one whose books have been audite
- nor do we expect to terminate with
the auditing feature of our busines
bv ~ Y Herald.