Evening journal., 1921-09-01


the audit of revenues. Just how
much the absence of such a law
means can only be imagined, as
there is no way OF telling the licenses
which have been overlooked by the
clerks of the peace; nor the corpor-
ations which are delinquent in pay
ment of franchise tax; nor is there
any check on fees collectible by the
Office OF the Secretary of State; nor
is any audit possible OF the collec-
tions OF the State Insurance Com
mission.
These citations are not directed
towards any Individual official The
criticism is intended to call to your
attention the lack of any well organ
lied and proper system. The Legis-
lative Committee Of this association
could perform no more valuable
service to the State than seeing to
the passage of a law or laws which
will provide the proper mechanical
facilities which will assist in public
officials 10 intelligently perform
their duties and give them a guaran-
tee OF clean sheet, both during
and after their term OF Office. To ac-
complish this object there should be
an audit OF all revenues. as we'll as
an audit OF all expenditures.
Having now briefly referred 10
some Of the problems of revenue
which confront the State. let us con-
slider for the moment practice which
has existed in the General Assembly
OF applying the revenue from a par
ticular source to a specified pur-
pose. Reference is more particular
ly directed to the law stipulating the
funds derived from the income tax.
namely, for the support of the
schools and highways. What is the
advantage OF such procedure ?
/ There can be none--it does not in
crease the revenue; 1t does not sim
plify bookkeeping; IL does not pro-
tect the schools or the highways by
guaranteeing them revenue. on the
contrary. it endangers and lessons
the efficiency of these State depart
ments by making the amount OF
revenue uncertain. The finances OF
the highway department would
seem TO prove this. judging from
the figures given in the Governor
statement as of January 1. 1891. In
1918 this department received S145.-
600 from the income tax. In 1926
but $29,06S. a reduction OF $1t5,-
932. Undoubtedly this is largely re-
sponsihle for the difficulties In
which that department is today.
what is the objection 10 piac-
ing all the revenue In the genera
fund and apportioning the funds tc
the various functions. activities and
departments Of the State according
70 their legitimate requirements
II would give more ieeway and avoid
such difficulties as the highway de-
partment Is experiencing at present
The budget could be prepared more
readily and scientifically. and we
would be able to eliminate the
archaic and Objectionable phrase
ology which appears in many acti
carrying appropriations. arceiy
payable out OF funds not other
/ wise appropriated"
Need Accurate Figures.
4 Theodore Roosevelt said. Thrift
r Is common sense applied to spend
2 ing" The budget Is an evidence o
common sense But Il does moi
e necessarily always follow that It Il
the best evidence or the first essen.
tial in intelligent spending. To have
attempted TO prepare an Intelligent
budget this year for the next two
years would have been next to i'm.
possible. A budget cannot be pre-.
! pared without complete and accu.
rate figures.
"As far as ascertainable. there ha.
never been any real audit OF the
books of the State; and the system
which has been in use "a single
y entry system). does not provide an
s automatic audit. Even the state
81 ment presented by former Governor
\ Townsend. January /. 1921 (whici
( is similar in form to that submitted
e. by the Governor to the General As
70 sembly in January 1915. which wa
|. the first detailed information re
e garding finances ever presented 4
II the members Of General Assembly
n does not give information OF tn
I. finances which is sufficiently com
a plete for satisfactory work.
" ITO prepare a complete, accurat
Ie and dependable statement in tn
a past has been impossible. owing {
X the absence OF any modern syster
r OF accounting. The State Auditor
D. Hon. Daniel Thompson. is now hav
N ing installed a complete and mod
n ern system of accounts by W. 7
Of Richards & Company Of New Yori
ar firm OF international reputatio
In accounting. For this move {
a improve the State accounting cor
,e dltions the members of the recer
TX General Assembly are TO be con
a mended; and the State AuditS
q should be commended for n
promptness with which he has pr,
-, ceeded to introduce system into OF
State accounting.
/, This law enlarges the powers
= the auditors Office. and permits II
"a installation OF modern system
- accounts for the State. The fgur
"a used in this paper we're furnish,
by the State auditor-probably q
- first reliable statement OF the asse
- and liabilities of the State furnish,
- by a State auditor.
The new system OF accoun
"a should make complete financial da
~ readily available. and be the bal
"a for intelligent planning OF expen,
'th lures and economy. Government
a accounting Is science speci
"a lied branch OF general accounting
OF iact "hlch the members OF thls
a. sociation doubtless appreciate WI