BANKRUPT BUILDER

Sun (Auckland), Volume IV, Issue 966, 8 May 1930, Page 10

BANKRUPT BUILDER

“NOT A SET OF BOOKS AT ALL” ACCOUNTANT’S EVIDENCE “It is not a set of books at all,” said Mr. George Gray Campbell, giving evidence in the case in the Supreme Court this morning, before Mr. Justice Smith, against Clarence William Bruce, builder, charged with wilful failure to keep proper books, with the intention to conceal the true state of his affairs. He was also charged with failure to keep proper books within three years previous to bankruptcy. Mr. Hubble appeared for the Crown, and Mr. Jordan for bankrupt. Yesterday afternoon Thomas Charles Douglas, clerk in the official assignee’s office, said accused was what was termed a speculative builder. He filed in bankruptcy on July 5, 1920. His schedule showed £28,230 owing to secured creditors, while the estimated value of the securities was £28,160, leaving a deficiency of £7O. The only assets other than those under security were five sections at Swanson, which in all bankrupt valued at £25. and on which it had not been possible to realise. A number of creditors had proved because of deficiencies in their securities totalling £B6O. The deficiency of £B6O would be divided among five of the 30 second mortgagees who found deficiencies in their securities. A number of second mortgagees had not proved, either being satisfied with their securities or considering it worthless to trouble. As the estate stood, those who had proved for deficiencies would receive nothing. No check of the payment of wages by the accused could be made, witness said. It had been ascertained that, four months before his bankruptcy, Bruce drew £1,600 for wages. A solicitor, Edward Lewis Thwaites, gave evidence of the records in a cash book which had been missed since the proceedings in bankruptcy. The cash book was merely a copy of the bank statement, he said. The cash-book appeared to have been written up from the pass-book and the bank statement, according to Victor R. Crowhurst, who was actingofficial assignee in Auckland at the time of Bruce’s bankruptcy. TODAY'S EVIDENCE When evidence was continued this morning, John S. Russell, a public accountant, who kept the* booiis of five Auckland builders, said that a cash book, journal, ledger and wages book were essential to keep a proper record of a builder’s affairs. One of his clients kept some of his books in | a similar manner to those of accused, but he also had other books. “It is not a set of books at all,” said George Gray Campbell, a public accountant, in commenting upon the books kept by accused. lie had investigated Bruce’s books and could not see how a profit and loss account could be made up on the information there. There was no ledger account to show if capital had been lost or drawn from the business. A cash book did not show assets and liabilities of a business. The capital account would not appear, and it would be necessary to have more information than provided by a cash book before a proper profit and loss account could be prepared. He considered that the proper set of books kept by a builder should consist of a journal, cash book, ledger and wages book. Witness said that from the bank statement. he had ascertained that bankrupt’s mortgages amounted to £21,525, while there was an expenditudo of £756 and £l,lOO, which brought the total up to £23,381. MISSING CASH BOOK In opening for the defence, Mr. Jordon made mention of the fact that the cash-book had disappeared. It had been asked for and the onus was on the official assignee or the Crown to produce it. This had not been done, and in consequence the accused would give an account of the facts in the book and these facts would be supported in evidence. His Honour said it would be necessary to hear the Crown witnesses on this point. Mr. Douglas was edn?"quently recalled and said that a thorough search had been made for the missing book in his office. Accused said that for the first two jobs he did not keep books, but he commenced to do so when he started his third job. He had used books ever since and at no time did he get move than a week behind, except on two occasions when he was away. His books had been examined by the income-tax inspector, who said that they were all right. “I absolutely deny that I wrote tlie cash-book up just before my bankruptcy and if Mr. Th waites speaks the truth he could not have possibly seen the book,” said accused. He had seen the book once since he handed it to the official assignee, and that was at the first meeting of nis creditors. He had never been summoned for debt and had £7OO on January 1, 1929, but he had none of that money left at the time of his bankruptcy. The statement he had made correctly showed what had happened to this amount. (Proceeding.)