mittance for the exact amount collected to date, while in other cases a round sum is remitted daily.

The agent makes up a balance sheet daily, weekly or monthly according to the will of his superior accounting officer. This balance sheet or "account current as it is commonly called, is a summary of the agent's transactions with the company, and is partly a recapitulation of the cash book totals. In making up the account he first enters the balance due the company or himself, from the previous month. The amount of freight and advance charges on freight received, amount received for prepaid charges on freight forwarded, baggage forwarded prepaid, baggage received collect, ticket sales and miscellaneous charges are entered upon the debit side. The amount of prepaid freight received and advance charges on freight forwarded, the remittances sent and balance due the company are shown as credits. The balance due the company is usually largely made up of uncollected bills for charges on freight. A detail statement listing the bills on hand and giving a brief statement of the reasons for their non-collection, accompanies the account current when it is sent to the auditor.

The entries on the account current that are not posted from the cash book are taken from the totals shown on freight received, freight forwarded, baggage received, and baggage forwarded reports. If these have been kept written up to date, it is a comparatively simple matter to post the items and balance the account current.

CHAPTER XII.

STATION AUDITS.

A large percentage of electric railway revenue passes through the hands of trainmen and station agents on its way to the treasury.

Many interurban railways sell passage tickets and accept freight at stations located in towns along their right-of-way, and their station agents in consequence handle large sums of

money.

The chief accounting officer exercises supervision over the station agents' accounts; he is charged with the duty of planning the system of accounting to be used, and of making a "continuous" audit of the agents' accounts.

The continuous or daily audit, however, must of necessity be confined to examination of the memoranda, records and reports sent by agents to the auditor's office.

While this audit acts as a sort of brake, and is effectual in correcting unintentional mistakes, it is far from complete. Large shortages in the accounts of a station agent can exist without any knowledge of it being had by the auditor, unless some slip or accident casts suspicion upon the agent.

The accounts in the station agents ledger are carefully watched by one of the auditor's competent assistants, and if an agent is not remitting promptly for the debits shown, the traveling auditor should be instructed to make a station audit.

Station audits should be made as frequently as possible, even though all conditions seem favorable; appearances are often deceitful, and even if no shortage exists, the traveling auditor can help the agent in many ways by giving him the benefit of some of his hard-earned experience.

The traveling auditor should be a man of strict integrity and good morals. If his knowledge of station accounts is supplemented by a good store of general accounting experience, his services will be all the more valuable.

One of the most important precepts he learns is to keep his

own counsel. The nature of his business is such that when instructed to audit a station, he should not inform anyone of his purpose-least of all the agent whose accounts are to be checked, or the trainmen on the line.

When the traveling auditor steps unexpectedly into a station, his first act is to count the cash. The agent is asked for all the funds on hand and the amount is at once verified in his presence.

An examination of the ticket stock is then made. The card tickets in the ticket case are first counted if the station is a busy one. These tickets are usually the stock from which sales are being made, and by counting them first, the business of the ticket office is interrupted as little as possible.

Coupon tickets, mileage books, and the entire supply of every kind of tickets is counted and an inventory made.

Baggage checks of intrinsic value, storage receipts and everything else sold by the agent is taken account of, in order that the audit may be complete.

It is customary to make superficial audits, in some cases, of stations considered "safe." Agents are usually under bond, and if the bonding company does not require frequent audits, the matter does not always receive careful attention.

When a new agent is succeeding the present incumbent, a certain amount of the work of counting is thrown upon the newcomer. For example, the traveling auditor will make a superficial check by counting cash on hand, and taking a list of the lowest numbers shown on the packages of each kind of tickets. A balance of the old agent's accounts is taken and if everything appears satisfactory, the traveling auditor does not count the ticket stock.

Instead of doing so, he has the new agent do the counting, and give him a receipt for the entire stock on hand.

If the station audited is a freight station, the preliminary procedure is the same, but instead of counting tickets the traveling auditor concerns himself with the uncollected bills and freight on hand, and the way-bills forwarded, not reported.

He is, of course, provided with a statement of the agents account at the latest balance, as taken from the station agents' ledger. To this must be added the amount due on way-bills forwarded and received since the balance.

It is not always possible to ascertain the amount due from

the latter source until opportunity has been had to check the accounts of other stations, and an approximation is therefore made, to be verified later. The station file copies of way-bills may be incomplete, especially if the agent is careless or incompetent.

If a change is being made in the agency, the new agent is held responsible for all billing of certain dates, and the former agent is not released from bond until his account is completely and finally cleared.

Unless

A careful examination is made of the uncollected bills. there is a good reason given by the agent, the freight for each uncollected bill should be on hand at the station. The traveling auditor inspects the freight on hand and compares it with the uncollected items as shown by the way-bills. There are cases where credit is extended to certain shippers and consignees, and the freight is not on hand for these accounts. Some steps towards verifying the agent's figures should be taken; the balances may be verified by communicating with the agent's debtors, if practicable.

When an agent is removed or transferred, he is held responsible for any acts during his administration, even although errors and omissions are not all located until some time afterward. The new agent is started with a clean score under certain conditions mutually understood on the part of himself and his employer. It is quite important that the lines of responsibility are clearly drawn. The agent should realize that he is responsible for all transactions occurring during the period of his service, and that there can be no evasion of his liability. He should be required to give a full and clear receipt for everything of value turned over to him at the time he commences his duties.

The uncollected bills are itemized, and given him to collect. If some are found in the future to be uncollectable, it will be his duty to ask for "relief" by giving the reasons for the noncollection, and a full explanation of the circumstances in connection with each item. Unless relief is had, his account will stand charged, and the bills will be considered a part of the balance he owes the company.

A printed form (Fig. 25) that is found convenient in making an inventory of the ticket stock, is a sheet that has spaces for

entering descriptions of the various kinds of tickets used. The traveling auditor makes this up in duplicate, in order that one copy may be left with the agent, if a change is made in the agency. The new agent receipts at the bottom of each sheet comprising the inventory. The receipts are filed in the auditor's office, with the record of the audit.

The traveling auditor makes up a balance sheet for each station that he completely audits. The form (Figs. 26) illustrated

FIG. 25.-(Front side)-Actual size 8" wide by 13′′ high.

makes provision for separate balances of ticket and freight accounts. If the station is a combined ticket and freight agency, the cash book contains all cash transactions, but the system of making reports is usually such that it is found more convenient to make separate balances of the two classes of business. Before starting out to audit a station the traveling auditor examines the agents ledger and enters the debit or credit balances in the proper places on his report blank. Upon reaching the