Good Work for Pittsburgh Office Client
Misplaced decimal makes $42,000 overpayment
An overpayment of $41,749.56 was discovered by John C. Williams
during an examination of a Pittsburgh client's financial statements.
The overpayment related to the purchase of Federal Tax
stamps to be affixed to the original issue of certain stock certificates.
Mr. Williams noticed that the bank requested payment of $4,757.50
in connection with an issue of 275,000 shares of common stock, but
had charged $46,388.40 for approximately the same number of
shares in a similar issue. Analyzing this expense, Mr. Williams questioned
the big difference between the two amounts and determined
the correct figure to be $4,638.84—not $46,388.40. When notified,
the bank acknowledged the error.
Plant accountant writes checks to himself
While working at a subsidiary of the same client, Theodore R.
Miller found an irregularity in the imprest payroll bank account.
The plant accountant, Mr. X, wrote checks to himself for $500
during March and April without the knowledge or consent of the
plant manager. The money was repaid to the payroll account in
November and during the interim was shown as "wages paid in advance"
on monthly bank reconciliations. The cancelled checks involved
were withheld from the regular files by Mr. X.
Although the amount was nominal and was repaid before our audit,
it did indicate a weakness in control over plant bank accounts which
we had pointed out in our last letter of recommendations to this
client. The needed control has now been instituted.
Baltimore Office Opens
Our newest office was opened January 1 in Baltimore at 10 Light
Street. Karney Brasfield is the partner in charge of Baltimore as well
as the Washington Office. John Rihtarchik is audit manager and will
supervise audit staffs in both cities. Four other members of the
Washington staff now assigned to Baltimore are Donald E. Hudson,
Hugh V. Cochrane, David A. Forslind, and Thomas M. Fox. Mar-jorie
Patterson is the secretary.
MARCH 1960 17