AUDITING ACCOUNTS.

Auckland Star, Volume XXII, Issue 72, 26 March 1891, Page 2

AUDITING ACCOUNTS.

(To the Editor.)

Sic,—The days wo live in are eventful An investigation of the Rawlinga charges by the Supreme Court has furnished a new sensation. This apocalypse has dazzled our eyes by its superlative brilliance. Referring to 37th Psalm, v. 37, weareexhorted to'"mark the perfect man;" had this injunction been strictly regarded, tho treasurer, committee and auditors of the Parnell Orphan Home would not this day be weeping, wailing and gnashing their teeth over the loss of £1,800, feloniously abstracted from the cofiors of the institution by a series of manipulations dexterously executed by the late Secretary, who, herein unchecked, consistently lived up to his privileges. It appears that by _ series of petty peculabions commencing as far back as 1581 a sum of £220 was abstracted from tho Savings Bank ; bub as this portion of the accounts was nob under audit, this gross irregularity might thereby have escaped detection. In 1884, however, the sum of £12,000 was bequeathed by tho late Mr Costley to the institution. (1) Howbheyearlyrevenuaaccruingtherefrom in tho shape of interest could be tampered with, withoub the knowledge of the auditors, is one of those sublime mysteiies the depth of which the line of human reason ia powerless to fathom. (2) How moneys paid for maintenance could gravitate to Mark's exchequer, without the cognisance of the said auditors, is another of those problems difficult of solution. (3) That the accounts should have been ingeniously cooked so as to elude the observation of the auditors, is a conundrum very hard to guess. (4) That this should have been n region of gross and impenetrable darkness to these groping experts, and on the other hand have been traversed subsequently by an

accountant who found lux in tenebris and illumined the position, furnishes irrefragable evidence that "wisdom is justified of her children," and thab the mischief oughb long ago to have been detected. Moreover, assumption of office was tantamount to consideration, and a tacit admission of fitness. A party voluntarily undertook to store wine for a gentleman in his cellar ; the casks thereafter leaked and he was sued for damage, but pleaded no consideration. Ib was, however, held that the kernel of consideration was found in the shell of the offer.

(5) That His Honor, in animadverting on the case, should have stated '' that the gross carelessness of tho audits was a temptation to crimes," and that the public fully coincide with this dictum, there is no doubt whatever.

(6) These severe and caustic strictures, however, do nob recoup the £1,800 of which the orphans have been co shamefully divested. Their loud wail has gone up to heaven, und from tho lips of tho recording angel, transmitted by telephone from the high courb of the universe, wo catch the message, " A father to the fatherless, and a husband to the widow, is God in His holy habitation."

In tthe United Kingdom, auditors who pass bogus and fictitious accounts are held responsible, and compelled to make restitution in cases where through gross nogligence tho funds of a company have sutfered through their laches or misrepresentations. Ib muy be alleged that here the services were honorary (therefore actuated by the higher prineiplo of love); if so, then ipso facta, by parity of reasoning, it follows they should have been faithfully carried out, and tho certificate held back, unless the audit represented a truo and correct state of a flairs.

I can submit a plan which, if rigidly carried out, would prevent tho possibility of irregularity and corruption germane to this scandal over occurring again, which is as follows :—That the sources of income aro rigidly scrutitiisod, and that the earnings aro properly accounted for ; that interest and ronts accounts are properly kept; that assets are shown at their real value in the balance-shoot; that expenditure is authorised and vouched ; that tho shares on tho rogiator agree with tho capital account; that the lists of debtors for unpaid calls, together with tho cash received ior calls, make up tho amount called up, and a multitude of other matters which a competent accountant and business man would require to look into.—l am, etc.,

John Abbott. St. Gcorco's Bay, Parnell, March 23rd, 1891.