The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1912-08-02
TANGLED MONEY
AFFAIRS OF HAWAII
Many Accounts Not Audited for
Years-No Way Of Checking
Up Under System.
Mail Special 10 Tho AIvcrilscfJ

some nave not been audited at all for |
the past three years, reports H. Good |
ing Field, in a preliminary report made |
TO the board Of trade. Mr.. Field rec
ommends that special auditing board |
be named by the supervisors and that
AN appropriation be passed to cover the
expense of a proper audit, as a result Of
which the financial affairs Of the coun
ty may be Strengthened out and proper
system of accounting may be installed.
$4,000 to $4,000 and it would take from
four to six months to make.
In his report, Mr.. Field stated the
present county treasurer took Office in
January 1911, and about that time con
suited with the county auditor and later
with the chairman of the finance com
mittee regarding the fact that he was
not advised of the outstanding war
rants, and also that he (the county
treasurer) had no knowledge of the bal
ances of either the general or special
appropriation funds kept by the coun-
| ty auditor, in consequence of which, the
county treasurer was unable, at any
time to ascertain the financial status
! of the County of Hawaii. This state
of affairs has not since been remedied.
The general and special appropriation
accounts kept by county auditor have
never been audited, and the balances as
reported to the board of supervisors
from time to fine have never been veri-
| fed, although the same have been ac-
cepted as true balances.
On March 30, 1912, the balances APP
lpearing in the aforementioned general
Appropriation accounts were rescinded,
without resolution of the board of sup
ervisors, and the accounts referred to
were To all intents and PURPOSES, closed
as of the above date.
On January 4, 1912, statement of
balances appearing in the auditor =
books was handed to the county clerk,
and referred, without verification. to
the finance committee. This committee
reported the same to the board of sup
ervisors and n necessary deficiency ap-
preparation was passed by them
No Way of Checking Up.
Under the present accounting system,
the county treasurer has no means of
checking the correctness of any of the
warrants drawn by the county auditor,
but is compelled to accept the same
upon presentation by the bank, or
banks, for its face value and subject to
the genuineness of the signature of the
county auditor on the warrant.
The authorization to set aside certain
sums of money from the treasurer six
! standing funds is by copy of the origi-
nat resolution passed blythe board of
supervisors and which is handed by the
county clerk direct to the county audi
tor and on file in the Office of the coun'
ty auditor. 1t was found in checking
the postiHgs which appeared in the APP
preparation book of the county auditor
4 that, in several instances, transfers had
i. been made without supporting papers
Transfers from one special appropria
ton account to another were also made
g without corresponding authorization
f on file. Transfers, furthermore, hat
: been rescinded without apparent au
y thOriZatiOn.
Ripen Into Abuses.
To say the least, the present mum
s cipal accounting system of the County
g of Hawaii is not constructed on sOunc
principles of public accounting, and 5,
II long as such Irregularities are per
n mitted there is every opportunity TO
o them to ripen into actual abuses. TIL,
h extent of such technical and funda
u mental errors cannot be ascertaine'
p by testing the accuracy of the bull
Ie OF the postings by aggregates whicl
N appear in the subsidiary books an,
r ledgers which are represented in tn
le controlling accounts Considering
% therefore, the fact that no audit ha
" been made at any time of either gen
| pY..iaI 4
kept by the county auditor, and i
or view also of the known differences
ri however small, which exist betwee
Q. the actual and the reported balance
10 of the controlling accounts, it is in
n possible to state, with any degree o
A. accuracy, whether the accounts of tn
n County of Hawaii fully and fairly di'
n close the position of its affairs, or i
no what respect they fail TO do so.
no mere Swimming of the financial affair
=, of the county will not suffice.
The accounts of the secretary Of tn
board of liquor license commissioner
have never been audited, althoug
sums of money aggregating $l9,595.O
have been paid over to the count
treasurer by that official from receipt
- for liquor licenses The license ce
tifcates for the sale of liquor are i
] sued by the secretary of the board, I
above.
Mr.. Field quoted figures and il
y. stances to prove his many points.
80 Board Takes Action.
- When the reading was finished, ID
" Elliott asked Auditor Mcguire fe
,ol questions, in reply to which Maguil
ne stated that he had been the count
OF auditor since the inception of count
~ government here that the territori
es auditor had installed the system no
at in use, but had never audited II
ne county books, that being outside h
at scope of his duties. Mcguire did N
re- wish to make any statement uni
'c- after he had familiarized himsc
le' with the report, a copy of which VI
le' handed him.
Some discussion followed as TO VIII
Up form OF action should be taken, in h
nc course of which DIR. Elliott said til
10 the main issue WAS an important on
lt as the financial good name of Z
M County OF Hawaii was made matt
nv AZ nuoattnu A il aunauraa fhat