ANNAPOLIS, MD, March 16, 1912.
TO THE OFFICERS AND MEMBERS OF THE INSTITUTE:
Gentlemen:—I have the honor to submit the following report for the year ending December 31, 1911.
On Feb. 23, 1912, the Board of Control decided that the accounts of the Institute should be audited at the earliest convenient date by a firm of public accountants.
Black & Company, of Baltimore, were awarded this contract, and completed their work on March 15, 1912. In place of the report being submitted in the usual form, their report in full is published:
BALTIMORE, MARYLAND, March 12, 1912.
TO THE OFFICERS AND MEMBERS OF THE UNITED STATES NAVAL INSTITUTE, ANNAPOLIS, MARYLAND:
Gentlemen.—In accordance with instructions from your Secretary and Treasurer, Lieut.-Commander Ralph Earle, U. S. N., under date of March 6, 1912, we have made an exhaustive examination of the records, books of account, etc., of the
UNITED STATES NAVAL INSTITUTE, ANNAPOLIS, MARYLAND,
for the year ended December 30, 1911, and herewith submit certified balance sheet as of December 30, 1911, together with the following exhibits:
Exhibit A.—Cash account.
Exhibit B.—Investments (bonds). Exhibit C.—Statement of cash receipts and disbursements. , Exhibit D.—Operations for the year ended December 30, 1911. Exhibit E.—Trial balance, December 30, 1911.
Our investigation has been very thorough and complete, including an examination for the entire year of all checks and vouchers covering the cash disbursements; proving all additions in cash-book and ledgers; checking all postings into ledgers, and verification of cash, securities and surplus accounts. We were unable to verify the $164.23, consisting of checks, money orders and cash in safe in office, as of December 30, 1911, as our examination did not begin until March 8; but we did count the actual cash, etc., as of February 9, 1912, and found it to agree with cash-book balance.
As a result of our examination we have made some verbal recommendations which will, we think, greatly facilitate the work of your office and enable statements to be set up showing the actual condition of your Institute. We would also make the following suggestions:
First.—That all cash receipts be deposited in bank, and all cash disbursements be made by check; and, if it is found necessary to make any payments in cash, to provide your cashier with a petty cash fund out of which payments can be made, receipts taken and periodical reimbursement made to him.
Second.—That the out standing check #634 of $2.00 which we are advised has been lost, be taken up as a cash receipt, and that the error of $.01 be treated in a like manner.
Third.—That the difference, between the estimated marked value of the bonds owned by your Institute and the valuation as per the books, be charged off.
The general condition of the books of account, records, etc., of your Institute, is such, as to merit commendation; and we acknowledge, with thanks, the uniform courtesy shown us and the cheerful assistance rendered us by your office force while we have been engaged in making this examination.
Respectfully submitted,
BLACK & COMPANY,
By Wilmer Black, C.P.A.
Certified Public Accountants.
UNITED STATES NAVAL INSTITUTE, ANNAPOLIS, MD. BALANCE SHEET, DECEMBER 30, 1911.
ASSETS.
Cash (Exhibit A) $12,601.66
Investments (Exhibit B) 46,097.67
Accounts receivable 2,809.36
Accrued interest Inventory 112.50
Furniture and fixtures 300.00
LIABILITIES.
Accounts payable $1,255.09
Reserve fund 6,753.14
Balance January 1, 1911 $6,663.14
Transferred from General Fund 90.00
Surplus 56,612.96
Balance January 1, 1911 $56,432.57
Net Profit for year ended
December 30, 1911. (See Exhibit D) 180.39
___________ ___________ __________
$64,621.19 $64,621.19
We hereby certify that the above balance sheet is a true and correct exhibit of the condition of the United States Naval Institute, Annapolis, Maryland, as of December 30, 1911, as disclosed by the books of account.
BLACK & COMPANY,
By Wilmer Black, C.P.A.
Certified Public Accountants.
Dated at Baltimore, Maryland, March 12, 1912.
EXHIBIT A.
CASH ACCOUNT, DECEMBER 30,1911.
Seaman's Bank for Savings, New YorkCity $3,000.00
Balance, as per letter dated March 2, 1912 $3,000.00
Rhode Island Hospital Trust Co., Providence, R.I. $2,929.40
Balance, as per letter dated March 12, 1912 2,929.40
Society for Savings, Hartford, Conn 2,913.494
Balance, as per letter dated March 12, 1912 2,972.20
Interest not taken up until after Jan. 1, 1912 58.26
___________
$2,913.94
___________
Farmers' National Bank, Annapolis, Md 3,594.07
Balance, as per balanced bank pass book,
balanced February 6, 1912 $4,840.99
Less Deposits.
January 12, 1912 $830.13
Draft 67.67
January 11, 1912 132.95
January 25, 1912 328.22
February 6, 1912 1,445.99
_________
2,804.96
_________
$2,036.03
Add Checks drawn in 1912.
#897 $9.21
898 87.50
899 70.20
900 49.00
902 40.00
903 160.00
904 1,248.14
905 .95
906 6.00
907 75.00
908 50.00
909 87.50
________
1,883.50
___________
$3,594.13
(Checks #901, 910 and 911 still out.)
Less Outstanding Checks.
#634 $2.00
810 12.00
815 5.00
868 170.40
873 136.00
_________
325.40
___________
$3,594.13
Less.
Error of Bank (over) $.01
Error Jones check #736 .05
_________
.06
___________
$3,594.07
In Safe in Office.
Checks $67.71
Money Orders 9.19
Cash 87.35
_________
164.25
____________
$12,601.66
EXHIBIT B.
SECURITIES (BONDS) DECEMBER 30, 1911
Face value of bonds. | Name of company. | Amount as per books. | Estimated market value. |
$6,000.00 | Southern Railway 6-$1000 5% Registered Gold Bonds. | $6,745.14 | $6,432.00 |
2,000.00 | Washington Railway & Electric Co. 2-$1000 4% 50 yr. Gold Bonds Consolidated Mortgaged. | 1,715.00 | 1,720.00 |
18,000.00 | Northern Pacific & Great Northern R.R. 8-$1000 Joint Bonds Registered 2-$5000 C.B&O. Collateral Registered. | 17,718.83 | 17,460.00 |
2,000.00 | Potomac Electric Power Co. | 2,115.00 | 2,030.00 |
9,000.00 | Northern Pacific Railway 4-$1000 3% Registered Gold Bonds. 1-$5000 3% Registered Gold Bonds. General Lien due January, 2047. | 8,902.45 | 6,120.00 |
9,000.00 | B&O R.R. Co. 1-$50001st Mortgage 4% 50 year Gold Registered. 1-$1000 1st Mortgage 4% 50 year Gold Registered. 3-$1000 Prior Lien 3½% due 1925. | 8,901.25 | 8,842.50 |
$46,000.00 |
| $46,097.67 | $42,604.50 |
EXHIBIT C.
STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS FOR THE YEAR ENDED DECEMBER 30, 1911.
Balance, January 1, 1911 $1,934.63
RECEIPTS.
Dues $1,934.63
Subscriptions 1,251.53
Sale of Books 24,280.62
Sale of Proceedings 73.84
Advertisements 849.27
Interest on Investments 2,235.01
Postage 16.37
Binding 37.12
Life Membership Fee 60.00
Rebate on Insurance 71.50
Sundries 43.03
________
Total Receipts $30,852.92 30,852.92
__________
$47,676.44
__________
Balance, January 1, 1912 $12,601.66
DISBURSEMENTS.
Printing and Binding Proceedings $4,196.11
Printing and Binding Extra Publications 13,392.51
Salaries 3,250.00
Contributors 2,533.05
Authors of Text-Books (Royalties) 4,483.20
Postage and Telegrams 583.51
Expressage, freight and hauling 85.53
Purchase of Books for Sale 835.67
Office Expenses—Stationery, supplies, etc 220.92
Foreign Copyright and Royalties 117.41
"War on the Sea," "Genius of Naval Warfare."
Prize Essay Award 213.95
Honorable Mention Award 180.00
Purchase Northern Pacific & Great Northern R. R. Bonds 4,815.69
Refunds 10.28
Rent of Safe Deposit Box 5.00
Engraving Prize Essay Medal and Case 10.75
Subscription to Magazines 8.32
Subscription to Naval Directory 1.10
Purchase of back numbers of Proceedings 11.00
Insurance on Institute Property. 80.00
Attorney's Fee 40.00
Discount on drafts .77
________
Total Disbursements $35,074.78
Balance, December 30, 1911 (Exhibit A) 12,601.66
________
$47,676.44
EXHIBIT D.
OPERATIONS FOR THE YEAR ENDED DECEMBER 30, 1911.
Inventory, January 1, 1911.
Back numbers of Proceedings $200.00
Extra Publications 1,000.00
_____ $1,200.00
Purchases.
Books for Sale $835.67
Back numbers of Proceedings 11.00
_____ $846.67
Printing and Binding Proceedings $4,500.28
Printing Extra Publications 13,392.51
_____ $17,892.79
_________
$19,939.46
Inventory, December 30, 1911.
Back numbers of Proceedings $200.00
Extra Publications 2,500.00
_____ $2,700.00
_________
Cost of Publications sold $17,239.46 $17,239.46
Profit on Sale of Publications 6,6016.14
__________
$23,255.60
EXPENSES
Postage and Telegrams $567.14
Expressage, freight and hauling 83.03
Exchange .32
Insurance 8.50
Contributors 2,533.05
Salaries 3,250.00
Authors of Books (Royalties) 4,483.20
Office Expenses (stationery, supplies, etc.) 227.87
Foreign Copyright and Royalties 117.42
“War on the Sea,” “Genius of Naval Warfare.
Transferred to Reserve Fund 90.00
Prize Essay Award 213.95
Honorable Mention Award 180.00
Refunds 10.28
Attorney’s Fee 40.00
Rent of Safe Deposit Box 5.00
Engraving Prize Essay Medal and Case 10.75
Subscription to Magazines 8.32
Subscription to Naval Directory 1.10
________
Total Expenses $11,830.93 $11,830.93
Net Profit 180.39
__________
$12,011.32
Sale of Books $23,164.69
Sale of Proceedings 90.91
________
$23,255.60 $23,255.60
__________
Profit on Sale of Publications $6,016.14
Dues $1,847.81
Subscriptions 1,255.53
Advertisements 525.50
Interest on Investments 2,235.01
Bindings 30.25
Sundries 41.08
Life Membership Fee 60.00
_________
$5,995.18 5,995.18
___________
$12,011.32
EXHIBIT E.
TRIAL BALANCE, DECEMBER 30, 1911.
Cash $12,601.66
Investments 46,097.67
Reserve Fund $6,663.14
Surplus 56,432.57
Dues 1,841.81
Subscription 1,255.53
Sale of Books 23,164.69
Sale of Proceedings 90.91
Advertisements 525.50
Interest on Investments 2,235.01
Postage 556.14
Binding 30.25
Expressage 82.68
Sundries 41.08
EXHIBIT E.-Continued.
Exchange $.32
Life Membership Fees $60.00
Cash in exchange for checks 6.73
Insurance 8.50
Printing and Binding Proceedings 4,500.28
Printing Extra Publications 13,392.51
Contributors 2,533.05
Salaries 3,250.00
Authors of Books 4,483.20
Telegrams 11.00
Purchase of Drafts 124.15
Freight and Hauling 1.35
Prize Essay Award 213.95
Honorable Mention Award 180.00
Rapid Addressing Machine Co 41.75
Rebates 10.28
Office Expense 15.03
Stenographer and Typewriting 15.20
Rent of Safe Deposit Box 5.00
Engraving Prize Essay Medal and Case 10.75
Subscription to Magazines 8.32
Subscription to Naval Directory. 1.10
Purchase of Back Numbers of Proceedings 11.00
Attorney's Fee 40.00
Accounts Receivable 2,809.36
Accrued Interest 112.50
Inventory December 30, 1911 1,200
Furniture and Fixtures 300.00
Accounts Payable 1,255.09
________ ________
$93,608.31 $93,608.31
The second suggestion made by this firm has been carried out. The first and third suggestions are under consideration.
The investments, hither to carried at price paid for them including brokerage, will, if carried at market value of December last, show an apparent decrease in the surplus of $3,493.13.
The actual net gain during the year has been therefore $180.39.
A change, suggested by the accountants, has been made in the method of bookkeeping which simplifies, in a measure, the work connected therewith, and enables quickly a balance to be struck and a full report to be rendered of operations at any time that it is desired.
Respectfully,
RALPH EARLE,
Lieut.-Commander, U. S. Navy,
Secretary and Treasurer.