MAY 8, 1922, 1 COMP. GEN. 631

MAY 8, 1922, 1 COMP. GEN. 631

WITHDRAWAL OF RECORDS FROM GENERAL ACCOUNTING OFFICE AN ACCOUNT FOR A STIPULATED PERIOD SUBMITTED FOR AUDIT BY A COLLECTOR OF CUSTOMS SHOULD BE COMPLETELY SUPPORTED BY ORIGINAL DATA AND REMAIN INTACT IN THE CUSTODY OF THE AUDITING OFFICERS TO GUARD AGAINST ALTERATIONS OR LOSS, TO PRESERVE THE ADMISSIBILITY OF THE PAPERS AS EVIDENCE, AND OTHERWISE TO PROTECT THE INTERESTS OF THE UNITED STATES, OF THE AUDITING OFFICERS, AND OF THE ACCOUNTABLE OFFICER.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE TREASURY, MAY 8, 1922:

I HAVE THE HONOR TO ACKNOWLEDGE THE RECEIPT OF YOUR LETTER OF FEBRUARY 28, 1922, IN REGARD TO THE PROPOSED DISCONTINUANCE BY THIS OFFICE OF THE PRACTICE OF RETURNING TO COLLECTORS OF CUSTOMS ORIGINAL INVOICES AND OTHER PAPERS FORMING PART OF THEIR ACCOUNTS SUBMITTED TO THIS OFFICE FOR AUDIT.

YOU EXPRESS THE VIEW THAT IN THE ABSENCE OF EVIDENCE SHOWING THAT THE ADVANTAGE TO THIS OFFICE IN MAKING THESE PAPERS PART OF ITS PERMANENT RECORDS OFFSETS THE RESULTING SERIOUS INCONVENIENCE TO COLLECTORS AND OTHERS YOU FEEL HESITATION IN APPROVING THE PROPOSED CHANGE; THAT IT IS DESIRABLE THAT THE ORIGINAL PAPERS BE BEFORE THE COLLECTOR FOR RELIQUIDATION OF ENTRIES BECAUSE OF CLERICAL ERROR OR INCREASE OF DUTY; AND THAT IT IS DOUBTFUL WHETHER THE BOARD OF UNITED STATES GENERAL APPRAISERS WOULD TAKE JURISDICTION OF A PROTEST FILED BY AN IMPORTER AGAINST INCREASE OF DUTY UNLESS THE ORIGINAL PAPERS WERE FILED WITH THE PROTEST.

THE LAW FIXING THE JURISDICTION OF THE COMPTROLLER GENERAL AS TO THE AUDITING OF ACCOUNTS OF THE TREASURY DEPARTMENT "REQUIRES HIM * * * TO EXAMINE ALL ACCOUNTS RELATING TO THE CUSTOMS SERVICE * * * AND CERTIFY THE BALANCES ARISING THEREON TO THE DIVISION OF BOOKKEEPING AND WARRANTS.' STAT., 206; 42 STAT., 23-27. SUCH AN EXAMINATION AND CERTIFICATION REQUIRE A COMPLETE RECORD OF EACH ACCOUNT CLEARLY PROVING THAT ALL PROVISIONS OF LAW HAVE BEEN COMPLIED WITH IN THE COLLECTION AND DISBURSEMENT OF PUBLIC FUNDS.

OBVIOUSLY A LEGAL, AUTHORITATIVE, UNQUESTIONABLE AUDIT, ACCORDANT WITH ACTUAL FACTS, CAN BE MADE ONLY FROM THE ORIGINAL DATA, AND WHEN THIS OFFICE HAS, AS THE RESULT OF ITS AUDIT, CERTIFIED THE BALANCE THAT HAS ARISEN THEREFROM, THAT BALANCE BECOMES THE OFFICIALLY RECOGNIZED SETTLEMENT OF THE ACCOUNTABLE OFFICER'S ACCOUNT BY THE GOVERNMENT AND IS FINAL AND CONCLUSIVE UPON ITS EXECUTIVE BRANCHES, AND THIS OFFICE MUST ACCEPT FULL RESPONSIBILITY THEREFOR.

ON THE GENERAL ACCOUNTING OFFICE ALSO DEVOLVES, UNDER THE LAW, THE RESPONSIBILITY FOR THE CARE AND PRESERVATION OF THESE ACCOUNTS AND THE EVIDENCE SUPPORTING THEM IN THE SHAPE OF THE CONCOMITANT PAPERS.

THE SETTLEMENT OF ALL ACCOUNTS OF THE GOVERNMENT AND THE CARE AND CUSTODY OF THE WRITTEN EVIDENCE FORMING SUCH ACCOUNTS THUS BEING VESTED IN THIS OFFICE, IT IS APPARENT THAT AN ACCOUNT FOR A STIPULATED PERIOD SUBMITTED FOR AUDIT SHOULD BE COMPLETE AS TO ALL PAPERS NECESSARY TO MAKE THE AUDIT FOR THAT PERIOD AND SHOULD REMAIN INTACT WITH THE AUDITING OFFICERS. HOLD OTHERWISE WOULD DEFEAT THE VERY PURPOSE FOR WHICH AUDITING OFFICES ARE RECOGNIZED AND ESTABLISHED. NOT ONLY THE INTERESTS OF THE UNITED STATES AND THE AUDITING OFFICERS REQUIRE THIS, BUT IT IS ALSO NECESSARY FOR THE PROTECTION OF THE ACCOUNTABLE OFFICERS THEMSELVES, WHO SHOULD AT ANY TIME BE ABLE TO PROCURE FROM THE RECOGNIZED GOVERNMENT ARCHIVES, WITHOUT DANGER OF PAPERS BEING LOST OR OTHER COMPLICATIONS, ANY INFORMATION OR DULY AUTHENTICATED COPIES OF PAPERS THAT MAY BE NECESSARY TO THEM IN CONNECTION WITH THEIR ACCOUNTS. IT HAS BEEN WELL HELD THAT "TO PERMIT A PERSON OTHER THAN THE OFFICER TO WHOM IS COMMITTED THE KEEPING OF THE RECORDS TO TAKE THEM OUT OF THE OFFICE IS A MOST DANGEROUS AND PERNICIOUS PRACTICE, AND A PAPER SO PRODUCED IS NOT ADMISSIBLE AS DENCE.' WHITE V. FITLER, 2 PA.LAW.J., 302. AS THIS OFFICE MUST BE PREPARED TO SUSTAIN AGAINST ALL COMERS ITS FINDINGS IN THE SETTLEMENT OF AN ACCOUNT, IT WOULD FIND ITSELF IN A VERY EMBARRASSING AND IMPROPER SITUATION IF, WHEN LEGALLY CALLED UPON TO EXPLAIN ITS FINDINGS, IT WAS DISCOVERED THAT PAPERS UPON WHICH SUCH FINDINGS HAD BEEN BASED WERE MISSING FROM ITS FILES, OR, THROUGH UNEXPLAINED ALTERATIONS, DIFFERED FROM THE FINDINGS.

THE INVOICES IN QUESTION HERE ARE MADE OUT IN TRIPLICATE BY THE CONSULS, EACH BEING AN ORIGINAL. THE FIRST COPY IS FILED IN THE CONSUL'S OFFICE, AND BOTH THE DUPLICATE AND TRIPLICATE COPIES ARE USUALLY, AFTER THE LIQUIDATION OF THE ENTRY, EVENTUALLY FILED IN THE CUSTOMS DISTRICT, BUT IT APPEARS THAT ONLY ONE COPY IS USED IN MAKING THE LIQUIDATION, WHICH IS DONE BY THE COLLECTOR OR HIS REPRESENTATIVE BY MEANS OF RED-INK NOTATIONS THEREON, AND THAT COPY IS SUBMITTED WITH THE ACCOUNT FOR AUDIT, BUT IS WITHDRAWN WHEN THOUGHT NECESSARY FOR INFORMATION AFFORDED BY SUCH NOTATIONS. THE OTHER COPY APPARENTLY REMAINS IDLE AND USELESS ON THE FILES IN THE CUSTOMS DISTRICT.

IT WOULD SEEM THAT IF BOTH COPIES OF THESE INVOICES AND COPIES OF OTHER PAPERS WERE USED IN MAKING THE LIQUIDATION, AS APPEARS TO BE FULLY INTENDED, THE WITHDRAWAL OF THE COMPONENT PART OF AN ACCOUNT FROM THIS OFFICE WOULD BE UNNECESSARY; THE RISK OF LOSING THE ONLY RECORD OF VALUABLE AND IMPORTANT INFORMATION, WHOSE DESTRUCTION MIGHT ENTAIL SERIOUS CONSEQUENCES, WOULD BE ELIMINATED; CORRESPONDENCE BETWEEN THE COLLECTORS AND THIS OFFICE WOULD BE MATERIALLY REDUCED; THE PROPER AUDIT OF THE ACCOUNT WOULD NOT, AS AT PRESENT, BE RETARDED, PERHAPS JEOPARDIZED, BY THE WITHDRAWAL OF IMPORTANT PAPERS; AND THE COLLECTOR WOULD HAVE AT HAND IN HIS DISTRICT AT ALL TIMES FULL INFORMATION REGARDING HIS LIQUIDATION, THUS FACILITATING AND EXPEDITING THE TRANSACTION OF PUBLIC BUSINESS, BOTH IN THIS OFFICE AND IN THE CUSTOMS DISTRICTS. MOREOVER, THE ACCOUNT, WITH ITS SUPPORTING EVIDENCE FILED FOR AUDIT, WOULD REMAIN INTACT IN THIS OFFICE IN ACCORDANCE WITH ACKNOWLEDGED GOOD BUSINESS PRINCIPLES AND PROPER ACCOUNTING PROCEDURE AND AS CONTEMPLATED BY LAW.

IF NECESSARY THE CONSULAR OFFICERS AND OTHERS CONCERNED COULD FURNISH ANOTHER EXTRA COPY OF THE INVOICE AND COPIES OF THE OTHER PAPERS.

AS TO PAPERS ON FILE IN THIS OFFICE THAT MIGHT BE REQUIRED BY THE BOARD OF UNITED STATES GENERAL APPRAISERS IN TAKING JURISDICTION OF AN IMPORTER'S PROTEST, IF A COPY OF THE ENTRY REQUIRED BY TREASURY DECISION 34510, TO BE ATTACHED BY THE PROTESTANT, COULD NOT BE CONVENIENTLY FURNISHED FROM THE CUSTOMS DISTRICT, AN AUTHENTICATED PHOTOSTATIC COPY OF THE PAPER, OR OF ANY OTHER PAPER ON FILE IN THIS OFFICE, CAN READILY BE FURNISHED AND WILL BE ADMITTED IN EVIDENCE EQUALLY WITH THE ORIGINALS THEREOF. SEE SECTIONS 882 AND 886, REVISED STATUTES; ALSO SECTION 306, BUDGET AND ACCOUNTING ACT, 1921.

ANY ACCOUNT PLACED IN THE CUSTODY OF THIS OFFICE FOR AUDIT IS AVAILABLE UNDER PROPER SUPERVISION FOR EXAMINATION BY THE ACCOUNTABLE OFFICER CONCERNED OR BY HIS PROPERLY ACCREDITED REPRESENTATIVE, AND THE FULLEST COOPERATION IS EXTENDED TO ALL ACCOUNTABLE OFFICERS WHO DESIRE TO FILE WITH THEIR ACCOUNTS IN THE HANDS OF THE GENERAL ACCOUNTING OFFICE ANY ADDITIONAL PAPERS WHICH THEY REGARD AS NECESSARY TO EXPLAIN, SUPPLEMENT, CORRECT, OR MODIFY SUCH ACCOUNTS OR EVEN CANCEL PAPERS PERTAINING TO THE SAME. SUCH ADDITIONAL PAPERS ARE MERGED AND FILED WITH THE ACCOUNTS TO WHICH THEY RELATE AND ARE GIVEN FULL CONSIDERATION IN THE AUDIT AND SETTLEMENT. ADJUSTMENTS MADE IN THIS MANNER, AND THE REASONS THEREFOR, BECOME A RECORD PERMANENTLY OPEN AND CLEAR AND READILY UNDERSTOOD, FREE FROM POSSIBLE ADVERSE CRITICISM AND AFFORD FULL AND ADEQUATE PROTECTION TO ALL CONCERNED, WHILE ADJUSTMENTS MADE BY RETURNING PAPERS TO THE ACCOUNTABLE OFFICER MIGHT IN CASE OF FRAUD BE REGARDED AS POINTING TO COLLUSION ON THE PART OF THE AUDITING OFFICE. THIS METHOD OF MAKING NECESSARY ADJUSTMENTS OR CORRECTIONS IN THE ACCOUNTS OF OTHER DEPARTMENTS AFTER THEIR RECEIPT IN THIS OFFICE HAS BEEN FOLLOWED WITH ENTIRE SATISFACTION FOR MANY YEARS AND IT IS BELIEVED COULD BE USED WITH EQUAL ADVANTAGE IN THE AUDIT OF CUSTOMS ACCOUNTS.

IN CONNECTION WITH THE FINAL AUDIT OF CUSTOMS ACCOUNTS RECEIVED BY THIS OFFICE FROM THE CUSTOMS DIVISION, ATTENTION IS INVITED TO THE FACT THAT PAPERS BELONGING TO SUCH ACCOUNTS ARE BEING RECEIVED BY THIS OFFICE DIRECT FROM THE COLLECTORS WITHOUT HAVING PASSED THROUGH THE CUSTOMS DIVISION, TREASURY DEPARTMENT. THESE PAPERS ARE SINE QUA NON TO THE PROPER ADMINISTRATIVE EXAMINATION OF ACCOUNTS BY THE EXECUTIVE DEPARTMENT AS REQUIRED BY LAW BEFORE THE TRANSMISSION OF THE ACCOUNTS TO THE AUDITING OFFICERS. 28 STAT., 211, AND 37 STAT., 375. AS IT IS UNDERSTOOD THAT SUCH ADMINISTRATIVE EXAMINATION IS NOT NOW BEING GIVEN, IT SHOULD BE STATED THAT THIS OFFICE IS THUS REQUIRED TO CONSIDER DETAILS PROPERLY BELONGING TO THE ADMINISTRATIVE OFFICE, WHICH FURTHER DELAYS THE PROMPT SETTLEMENT OF ACCOUNTS ALREADY RETARDED BY THE NECESSITY OF CALLING FOR MISSING PAPERS OR THE WITHDRAWAL OF PAPERS ESSENTIAL TO A PROPER AUDITING OF THE ACCOUNTS. SEE SECTION 309, BUDGET AND ACCOUNTING ACT, 1921.