Evening star., 1926-11-04
PREAUD|T SYSTEM
T0bE EXTENDED
MCCarI Introduces Plan to
Abolish ''Red Tape" on
Veterans Claims.

In movement to abolish time
worn Government procedure. cut red
tape" and bring the Federal organi-
zation in step with the most adj
vanced principles used by business
today, Controller Gen. McCarl has
established throughout the Veterans
Bureau a "preaudit of all accounts,
and has been requested by some of
the most important Federal depart
ments 10 inaugurate this revolutions
ary change throughout their own es-
Establishments.
The change means simply that the
Government would not spend cent
until after the account had been
audited, instead of waiting until
after the money was spent to have
the account audited.
The 'preaudit" is in force through
out the business world. it was eX-
planned today, scarcely single con
Germ of any size or imp 9rtance today
clinging to the old system of trying
to audit after expenditure.
All Bonuses Checked
The change WAS efferte,l AT the
Veterans Bureau through c"-opera-
tion between Controller Gen. McCari
and Director of the Bureau Frank T..
Hines, who have been working cor
of spending the Government money
in the thousands Of compl Gated cases
growing out of the World War.
The Veterans Bureau inaugurated
the preaudit system in order to in
sure accurate handling of the enor-
nous task of the World War ad-
juSted compensate II, or bonus.
SO successful did the preaudit prove
in the Veterans Bureau that
Gen. IIiles requested it's extension
throughout the bureau. Today force
of about 65 persons from the Seneral
accounting office are established on
the same floor with the disbursing
officer of the Veterans Bureau, to
facilitate the work.
Numerous claims and differences IN
the accounts of disbursing officers
arising from the period prior to the
preaudt are still coming up for decl-
sion by the general accounting once.
The total of suspensions in the ac-
rounts of Veterans Bureau disburS-
ing officers for the period prior TO
the preaudit is estimated to total
nearly $4,000, 900.
May Save SlOO,O0O,O 900
Exact estimates are unObtalnable
as to the total disallowances and sus-
pensionS in the accounts Of all FED
eral disburSing officers, but II was
estimated unOfficially today that these
would probably mount up to the huge
sum of about 800, 900 in dispute.
This kind of dispute would be wiped
out by the preaudit, ii was explained
today. Business concerns when nave
dealings with the Government are
known to hail with delight the pros
pect of a preaudit in the Government.
1t is known. for instance, that our
ing the past some contractors III
building Government buildings nave
been paid in full for what the orig
inal contract called for. The con-
tractor accepted the money, made
return to the Government OF MS IN
come and paid taxes on his profit.
Later the old postaudit. perhaps sew
eral months or years later. checked
up and found that the contractor was
paid. say $50 900, in excess of what
he should have been paid under the
law. This entailed not only the diff
ficultv of getting the $4,000 back
from the contractor with the conse-
ouent embarra ssment to him, but it
involved his reopening his income tax
case with the Government and the
problem of trying to get from the
Government a refund of income tax
on what the Government had col
lected.
DiSburSing officers, ii is understood,
welcome the change, AS it relieves
them of the possibility of paying ac-
counts under orders from their chief,
only to have the payment disallowed
by McCarl.
Erir n,. nj