Ward Fanners' Association

Thames Advertiser, Volume XXIX, Issue 8692, 23 March 1897, Page 2

Ward Fanners' Association

• •- " - . 7 LIQUIDATOR'S INTERIMRE OUT. ' (For Press Association.) ■ Dunedin, March 22. The interim report of .the liquidator of the Ward. Farmers' Association states that of the share capital in contributing shares alloted to 30th June, . 1893, Mr Ward held 2000; the. directors, managers, and employees of the Association 920, and the general , public 2170. On shares held by Ward, £500 was . paid iu cash, the other £1500 being debited to his account, which at the time was in debit about £2100. Twelve months later the number of shares was increased by G971, of which 5000 were 'subscribe;!; by Ward, and 1142 by the general public. Ward's account was again dobited, his debit balance the day before being £43,376. The issuo; of debentures for £50,000, cent interest, is then treated -of, £31,000 being taken up the Colonial Bank, and £20,000 by the Bank of ■ Now Zealand at par, the latter bank charging £200 as' commission. The money was placed by the bank to the credit of the Association, but in the Association's books it is placed to the credit of Mr Ward, tvho owed the As« = sociation £42,4?8. The day before the balance in 1895, Ward .was"" 1 debited _ with the ambunt,. and a debenture, account opened. ■ Dealing with the balance-sheets, the liquidator shows • how, in the first one, the overdraft was reduced by £24,000 .by cheques of Ward's, while at the sarno timis entries in connection with,the freezing worka reduced Ward's account with the as* ; sociation from £35 741 to £4108. •' These were all reversed after balanc- , iug. TJie omissions from the balance- , sheet are pointed out. In the-Associa-' ; tion balanco'sheot of 30tli June,' i 1894, the. overdraft-. was reduced by Ward's chequo for £35,000, reversed .on the Ist of July. The ; omissions and discrepancies is compared with the books'are indicated. The advances against' produce to the' extent of £74,929 were, according to the books, £31,535. The book debts • wero £34,643, but tlxoro is no such item iu the balance sheet,, though part ' is probably includod in the current 1 account of £i 0 372.'. Attention is ■ called to several items not set out ia i the assets of the'lß9s balance 1 sheet the liquidator says that,the funds 1 of the bank mount jm " groply ' misrepresented" The grain and rail- ' age, overdraft of. £9,975, the past due , bills' of £19,438," the drafts against shipments £11,692, are omitted, and the draft for ' £31,000 on Connell and Co. and the promissory note of £10,000 '• in .-'connection'' with <'arswell are not mentioned. There were also omissions and discrepancies on the asset side, the value'of stock, etc., being understated. Attention is directed to tlie enlries m adjusting Ward's, various accounts, by . which: £i 9,-890' to his credit from.the salo of debentures' warttanrfeixetl to- ' the Association's. debentures' account * Credits were given to .Ward for£lß,ol6 and £6,500 from the account' of Brooks and Connell and Co., and • he appeared to li&ve £16 Is 3d' to his credit od-the. Ist of' July. These . firms' accounts were again credited with. . tho'amounts andreverted to the original position. The liquidator says he is unable to discover a trace of the oats warrants said to. have supported the £30,000 draft, or what: foundation of right there was for crediting Ward with the proceeds of the Association's debentures. It is due to Ward to say.thatlie was'out of the, colony when the balance sheet was made up. He vras represented by Mr Fisher, manager of the Association, who held a power of attorney. The liquidator says he <nnnot throw any light ou .the question as to why the drift for £25,800 on Cooper and .vhew was not presented, but kept i;i london -.for nearly 12 , months, oi\ wliy - Mrs 4 Barron's £5000 . guarantee was given up. Treating of the methods ; of fiuance, the liquidator says that almost from--the. first a' - system was. pursued of effecting temporary reductions of the Association's overdraft, open, to -1 giave. objections Fioiu the 25th Fibruary; 1893, to the

18th of Novcuib' r, 1895, drafts varying in amount' fom £100 to £6150 -• were drawn I)}; the Association uf on persons or t'tus in other parts of the colony and ako in, Australia. They were discounlPiFao tho bai& and shoi tly afterwards were taken up by the Assoc iiition, apparently without having been presented* to the drawees. The number of thrse drafts is 174, repce sentiii.- a total mini of £118,330. None of-Liua« were enured !ji the • h bwlr. They wei u »II drafi« on dewaii(l(except '*~ two) and there is no trsqe in the books to show that the drawees supported any of them. These diaft. - were evi* dently an expedient rebortid to with the concurrence of Mr Cook at certain times an apparent reduction of the overdraft: The product account and interest aocoui.t.having beeudealt , with the liquidator treats at some 4 length of the' profit and loss account. The profit for the first seven months was £1,993, and for the year pndings ■« June 1894, £2,916. The next year, - there was a loss of £457, making the total net profits £4,362. There wag paid in dividends anil bonuses so that the away - £2,918 more than it'earwd. The liquidator attributes the insolvency of the Association to insufficiency of capital, imprudent advances, and - absorption of the Association's capital - by Mr Ward's own business and !oo&es on shipments. These latter amounted to £7,629. • <-