WHO SHOULD AUDIT?

Dominion, Volume 3, Issue 916, 8 September 1910, Page 2

WHO SHOULD AUDIT?

' A DEBATABLE CLUESfION. :-\■■■■: ~. OPINION ON THE OTHEE SIDE. - The Council of tlie Wellington ChamKe?''. of -.Commerce, having decided at "a-Tepre*" - seniative meeting that ; it' 'was.', ' .desirable that sharebrokirs should act as auditors i!l couipsinica, 'and that: 'the', necessary- steps should:,be call; '* the attention of interested bodies' to '..the question,-, a-DoiiiNioiJ- reporter :'set.; .out'.-, to ascertain if there was.another , side , to> the question, 'and in;pursuance: of that object interviewed members .'of- : leadiiijfj ■. firms which combine the dual'business, .';.-:. '■■' '■ Mr. Leary's Opinion,- : r " '•'■' Mr. Leai-y (of the! firm of,Barr,.';Leary,f.' and '.Williams),.was. very clear :ahd. onU , spoken in hisyiews, and put.the.:p6sitiba) . from his standpoint as. follows:—.jv. ~ i " \"ln the first, place, , the .whole:demand)•:: emanates from;'a few :mteresteaV{parties;i■■■;!. and not from the public at.ailjidt came , '; from.. one- or ■'.two public- accountants. I, - do not think: the Government l should, tako' any reppminciidatipn"of the' Chamber - of Commerce "on this/'matterj"'.'- for''.',the'. simple ..reason. that it 'means? taking' away ■ part .of ,^the ; ..,'livelihood J >\a .-lot ftpf'.':-•"■ accountants havebeen enjoyiiig foryears,. '■'] arid in "addition' tbvthat. the appointment "'. ■of iiu-.-.enilitor>for. lionipany W . a-private concern.—which: nowi.rests-with*-;; the shareholders or-owners—should'hot! .' be reguliited: by.-.the, law."' ;! ■'•-'■■' ■ _ Our. reporter-pointedrjouf' that .•- Government was not being asked,■■■fe'."-itliH-*'- . anything;'in.the resolution:.adopted by';:' the Chamber : pf.-Commerced '■--' ?:.•'-;- " ■ Mr. Xeary continued: "But' thecinten-f' tipn is to have-provision to that effect '•■ , -:- In.evorycompahy 'the Shareholders have! : - -the-_ olection;of 'the .. auditors.■'£ If '■/-■ inl '•'- auditor■ is -an , 'honest■man;:heVwilT-take l .' :p6 notice: whatever of. 'what he 'sees while'': engaged, in the! audit ;of ..a'* cojnpany'ei business.: . : On : :the- other . hand, -if;- auf: auditor,is.jiot.honest,;it-would- ; .bo,.very;' : casyJor-him :tb ■giye;.'away : :the: inKrma-/': tiPn;heobtained-. ..to':.sbme.r'sharebrokingf ripnd;,' oi , '..other; friend,;v'; and: - they; co lild : V .act icither:; jointly:'orJ. independently of '■''■■: -,each other: in buying -or selling,- , as- the l ' ■ ■case'.may be/'-ils.- , a.--inatter>ofi'.'fact,\ if an auditor kn6ws.;his.bnsiness,:he>would -no';'.more .(Iream,;of jtalkiiig^'bf.vf^^accounts'. l ; that come'.under his notici). than "would -'' a'■: telegraphioperatori or-any:of-the- many 1 .. ■professional.' , .men; whpi -ai , e',-:ih ; -.tne..-:cbn» ■' fidence of others.::;lt is.only where a \ man ' is; dishonest:-that the;- argument .-'would' >PPly ~,ind:\this:- -proposal • cpiildr not .puVv' avstop. to "a/dishonest-man' l acting" ..as" he, ■ .wished, : anyhow,"- ; :;:.'^i ; ;V', %;,:.3 V^ \-:: : :K-j: '/■:'/There : is-.an6& this country ,is' not by any:.means Marge" : enough to.-, afford -, living's... at.--,-. auditing or sh'arobroking itij'■. people, "pur-".';"•■ "suing -both . branches ; ;of ■■the business. at.: .thevprcsent'time..- .It. is", possible■■in',=ibig:- • places likflvLondpn.and -other, large citiev ; but ■■here,'both branches have, to'bei com-. ' ;bined; to:!.get-ia v ,living;.:-I;;dq'notvthinK , youl.would-, '!■ find sa ; -single. Imarii'.whoV : porely.:'an" .accountant; in' the'-.country, i' ■ outside , the:''fjbur 'centres;-;This'agitatioa:.; does 'not ::come. from r the' public-^who : hay« .; ..ney'erjaske'd for; : it—but : :frbte ; one,f>ir^'two' ;: ■Sccouritants^iv,;- ;: 3::; : :/"It.: is :ials6; worthy , of; note'.'-tKat" ■? people' who '.ask;-for: this, change i ; have ■; given; no re^sons'whatever' iit^snpport-of. : their"'resolntibn.;!;. Why is itinot 'desirable , - that; shareteokerslphpuld- act>as/.auditors l ■:'■ lir-iny;'opinion'that "resplution'does;'not f: .go far| venpugh. ('• -If ■' it•■ is '■ not':.desirable,-': why dp': they ; not:give" sdme;Msdn?;;■'■ - <■;: ''j "I ;might :ppint ; ;:butythat;\ia"::; ■most of thp.eity-firms; .such' as ours, which;.' ; .combine:.botli ■• '/'businesses]' 'the :■;,'depart" -j mente'are.speMalised; arid .in the: actual v ;worldng;vtHe;'.'mem!b6rsvdf';;&;: fam..'-'iFßo.''Vafc( i ' : '. tend'; to; one"-branchilmpw.-little]• or■ : no<'y' : thing ■'. ;'■■■■'. J:' ir'. ":^.:-'■) Other; \!K : E;'.Bucholz expressed.'similar'/yiewi|, : -' ; tp. those; given; by Mr..•leary,'attributing ,; J /the resolution';.to; ■the.unfluencp;-:of 'one':"' ■the systfem' j 'a.t present.in-ydgueled'to:-aiiyV v abuses, : . or:: that.^there ; - was, the "slightest;.' ■ need for; apprehension; ii the publicAmind. .'■; Both the principals of Gualteri '■•: Dyke's, were'of: a;,6imilai!:;' •'niiiid, , they explained; auditing . -iy:as;b'ut;-;a ; : side'.■ : line-;.uL''.their-;-business,;:: ;and; they": would; npt be. seriouslyVaffecteiJ , ;; by i any.-'■ change'.that might-;'erisue.'.*r '',?■-,■:■*: v ':'..:-:■:■'. '■:.:'■ ' *".:' ; ' : "* 'j/, , ' '' •'