Custer weekly chronicle. [volume] (Custer City, S.D.) 1890-1931, 1892-09-17
AUDITING BOOKS At NIGHT.
One Feature of Expert Accounting That
Is Performed la secret,

ii will venture the estimate" said
q well known public accountant re-
Gently, shat not one-half of the num-
Der OF d%efalcations and thefts from
commercial and financial institutions
and business houses In the city are
ever made public,
Business men," he continued, "arc
10th to admit that they have been vic
timized. They 60 on the theory that
pupHcIty In suoh 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 less.
"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 10 invest money in bust
ness ventures, opening up new books
and going owe the books of institu-
tions that have been robbed.
THAT is, however, but a small por-
ton of the work. What we cali the
auditing feature of the business has
developed largely of late. The con-
duction of this reveals much that is
startling in a criminal way, and leads
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 with
a case that l have just concluded.
"The books OF a large wholesale
house were balanced by the Office
forces at the end of the year. They
showed the profits to be far less than
vas expected. The partners had an
idea of forming a stock company OF
their business. They did not question
the integrity of their cashier, who had
been with them many years. At the
same time they were anxious To find
out if everything was going properly
in their Office.
"They explained the circumstances
to me, and l proposed auditing their
books and outlined the work. 1t
amounts to nothing more or less than
this: Every night after the office was
closed the junior partner Of the firm
met two of my men who were special
ly detailed for The purpose. Together
they proceeded to the office, opened
the safe and worked until three o'clock
In the morning.
Every individual transaction of the
day was taken up and entered on
sheets of paper as though we were the
clerical forces of the house. We never
made an entry on the books or at
tempted to check back from them.
For a month we continued the work
without the knowledge Of the cashier
or his assistants.
"The result was as | expected. We
discovered Nh elaborate system of false
entries by which the firm had been de-
frauded for years. The cashier was
taken to task. without being informed
that his books had been audited. lie
denied his guilt, threatened suits for
SANDER and assumed IA yirtuous indig.
nation. When the other set of books
was shown him, however, he wilted,
confessed the crime. and pleaded fox
mercy. As he had been with the house
for a long time he was permitted Ia
resign, and i, OF course, am pledged
to secrecy regarding his identity.
That case" said the accountant in
conclusion, lis hut one of many where
q crime is hushed up. and" he added,
~that wholesale house is not the ouly
one whose books have been audited,
o do we expect to terminate with il
the auditing feature Of our business"
IN. y. Herald.