Of collateral interest;

              Bulletin HASKINS & SELLS 7
Of Collateral Interest
WHILE the public accountant is not
expected to be a lawyer, or versed
in the technique of legal procedure, obvi­ously
the greater his familiarity with the
statutes bearing on business procedure,
the more comprehensive his general equip­ment
for practice.
The excerpts which follow have been
taken from the Penal Law of New York
State. They may, or may not, correspond
with the statute provisions of other states,
but at least they should stimulate interest
in this subject and prompt those of us who
have to deal with such matters in states
other than New York to investigate the
laws of those states in this particular.
664. Misconduct of Officers and Directors
of Stock Corporations.
A director of a stock corporation, who con­curs
in any vote or act of the directors of such
corporation, or any of them, by which it is
intended:
1. To make a dividend, except from the
surplus profits arising from the business of the
corporation, and in the cases and manner
allowed by law; or,
2. To divide, withdraw, or in any manner
pay to the stockholders, or any of them, any
part of the capital stock of the corporation;
or to reduce such capital stock without the
consent of the legislature; or
3. To discount or receive any note or other
evidence of debt in payment of an instalment
of capital stock actually called in, and re­quired
to be paid, or with intent to provide the
means of making such payment; or,
4. To receive or discount any note or other
evidence of debt with intent to enable any
stockholder to withdraw any part of the
money paid in by him on his stock; or,
5. To apply any portion of the funds of such
corporation, except surplus profits, directly
or indirectly, to the purchase of shares of its
own stock;
Is guilty of a misdemeanor.
665. Misconduct of Directors, Officers,
Agents and Employees of Corporations.
A director, officer, agent or employee of any
corporation or joint-stock association who:
1. Knowingly receives or possesses himself
of any of its property otherwise than in pay­ment
for a just demand, and with intent to
defraud, omits to make or to cause or direct
to be made a full and true entry thereof in its
books and accounts; or,
2. Makes or concurs in making any false
entry, or concurs in omitting to make any
material entry in its books or accounts; or,