Of The Savings Bank Ledger

The savings bank ledger was taken in exactly the same way, a letter-card notice being sent to every depositor whose name appeared on the ledger, stating the amount shown at his credit on the date of the inspection. At present the same process is followed except that a number of banks have discontinued sending the notices to depositors. The expense in the way of postage and extra labor was considerable, and it has been thought, doubtless, that the reduction of expenses would offset any defalcations which the letter-cards would have served to prevent.

Deposit Receipts

Deposit receipts are on a somewhat different footing. Each receipt, on its being issued, constitutes a separate contract entered into by the bank. For the inspection a complete list of the outstanding receipts is made out, and balanced with the general ledger or balance sheet. In the ordinary routine, the branches are called upon to furnish head office with fortnightly or monthly statements of the receipts issued and paid. Some banks require the paid receipts to be sent to head office along with the statements on which they appear. There is thus a constant check on the branches in this matter. The inspector supplements it by observing all that is to be observed in connection with the deposit receipt register and the paid receipts held by the branch. Notices are not usually sent to deposit receipt holders.

Overhauling Other Departments

All the departments are taken in turn, the inspector examining them very closely. His investigation is for the purpose of ascertaining, on the behalf of head office, whether or not the affairs at the branch are really as reported in the branch statements. He makes it his business to meet the principal borrowers, talks to them about their accounts, and sizes up their businesses.

Among the things he has to report on are bank premises, vault, safe, furniture, etc. He describes whether the premises are well or ill located, how suitable they are, and suggests improvements or changes. He goes fully into the defences against burglars and thieves, describes the safe, the combinations on it, and the precautions taken. He is particularly careful to see that the rules about dual custody of securities and cash are observed.

Reporting On The Staff

When he has gone over everything else he reports on the staff. Taking the manager first, he gives head office his opinion of their trustworthiness and abilities. His visit will only last two or three days, but he will have seen all the men, and have had some opportunity of judging them at previous inspections of the same or another branch. Of course, he has them under close observation while he is there, and forms his opinion to quite an extent from the manner in which they do the inspection work. This test is not absolutely reliable, since some clerks get flustered or nervous when an inspection is on, and are not able to give a good account of themselves. However, the manager and accountant furnish much of the required information.