The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1910-12-20
Government is Now Planning
To Improve Banking Systems

such a weak defense, the loan is ex-
cessive.
Where the examiner believes the
loan may be excessive he should not
the date and maturity OF all notes I'M
der suspicion on his card. and. if at
the next examination there is no
changes or reduction it is safe to in
fer that the law is violated.
A discussion Of supposed excessive
loans. and supposed concealed loans
TO officers and directors with direct
ors themselves during the examina-
ton is always helpful. and has the
additional merit of putting them on re-
cord regarding statements of loans.
An examiner may occasionally err in
reporting an excessive loan, and con.
cealed loan to an officer or director,
but in the main with the knowledge he
possesses of the people and corpora
tons doing business with the banks
under his charge. and the circum-
stances attending special cases under
investigation, he is usually correct in
his classification Of these loans.
cialty of individual deposits and how
best to verify them from any data in
the banks, writes Mr.. Murray of his
experience as follows:
"On commercial ledger have
found ii good plan after taking a
trial balance to take a number of &C
counts Unfortunately through the
books. add up the total debts and to-
tai credits since the previous balance
and with the total balance thus OBJ
tanned prove the balance which has
been carried out from day to day. This
will show the true balance, as the bal
ances carried out from day to day
might have been increased by adding
one thousand or ten thousand, or
whatever the case might be.
Another method of proving these
accounts from data in the banks is to
take number of accounts. list the
checks and deposits. which should
be fled separately. add the last bal
ance, and in this way prove the post
ings.
I'm a number of banks in my dis
trict statements are sent to all active
accounts at the end of every month.
Where this is done, I have found it an
excellent idea to take these state
ments which are always made by
some person other than the book
keeper and verify a number OF &C.
counts. This also proves the correct.
ness of each entry.
I'm proving balances on ledgers, |
found it good way to take a date,
say ten or twenty days before the ex-
animation, add the balance on that
date. and then take the total deposits
and checks Of each day from the cash
book and figure the balances up to the
date of the examination. This will
prove that the daily debts and cred.
its have been properly entered on the
individual ledger. 1t is also well to
verify this ledger in the same way as
the commercial ledger. by either
checking back a number of the state
ments-if statements are rendered
monthly. or listing tle checks and
/ deposit tickets of number of &C
counts, and verifying the balances on
date of examination"
Comptroller Murray has recently in
stituted system calling for a detail
ed statement OF the workings of ev
cry examiner in the United States
His purpose is to keep tab on work
being done in the field so that he will
be fully informed of what his subor
dinates are doing.
| The results of the system arc re
ceived daily at the treasury depart
ment in the shape of reports on var
ious financial institutions.
1t has been estimated by Mr.. Muir
ray that the number of failures in
national banks will be considerably
less through the Inauguration of this
system.