A+B=Money for C;

              2 H A S K I N S & S E L LS January
A+B=Money For C
LE T A represent the account; B the
banker; C the customer of the bank
and the client of the accountant. In bor­rowing
money from B, C makes use of the
services of A. B has a relation to C.
A has a relation to C. Query: What is
the relation of A to B?
In the triangular relationship, which,
apparently, is a creation characteristic
only of modern times, the purpose is to
borrow funds with which to carry on legi­timate
business enterprise. The relation­ship
finds existence in connection with fixed
capital as well as current funds. The
commercial banker lends for short terms.
The investment banker places capital
loans for long periods and obtains capital
for permanent investment.
Character On the part of borrowers long
has been an essential prerequisite for bor­rowing
funds. Character still occupies a
place of importance in considering the
risk incident to the lending of money.
There is reason to believe, however, that
the importance of character is dwindling
somewhat in the opinion of various bank­ers
who have had the misfortune to sustain
heavy losses through loans made to busi­ness
enterprises whose officials were re­puted
to be men of character. Further,
the now wider geographical distribution of
loans by banks in large centers has tended
to diminish the former intimacy of per­sonal
acquaintanceship.
Probably it is not an extravagant or
immodest statement to assert that increas-ing
dependence and reliance steadily are
being placed by bankers upon the services
of public accountants and the professional
reports which they render. As indepen­dent
verifiers, the opinions of public ac­countants
with respect to financial condi­tion
and operating results have become
more and more essential to bankers in the
granting of credit and the lending of
money. Experience shows also that the
name and reputation of the accountant
have an important bearing on the value of
the report for credit purposes and in con­nection
with issues of securities, as well as
the marketing of commercial paper. It is
a matter of complaint on the part of the
younger and less known accountants in re­mote
parts of the country that money in
large amounts is to be obtained only
through bankers in large cities, who de­mand
reports of well known accountants.
The impression prevails, and is true in
some cases, that the bankers specify the
accountants who are to be employed, and
dictate generally the character of the
service and particular information which
they are desirous of having.
If it were true that all bankers are in
this enviable position, some of the misun­derstandings
which arise between bankers
and accountants would be eliminated. Un­fortunately,
in too many cases, the bor­rower
retains the accountant, specifies the
service which he desires, and upon receiv­ing
the accountant's report, submits it to
the banker for credit purposes. In far