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SECRETARIAL PRACTICE
Payments at In the case of large branches, or large works separated

Branches. from the main office, it will probably be more practical for
separate banking accounts to be opened as well as separate
petty cash accounts. Copies of these, with the necessary
supporting vouchers can be sent to the main office at regular
intervals to be embodied in the books of the company.

When the works or spending departments are separated
by some distance from the main office at which the principal
book-keeping of the company is done, it is particularly
necessary that care should be taken to devise a system which
provides the necessary safeguards for the directors and the
secretary and other officials. Effective methods are, that
either the whole of the cash transactions of the works or
branch shall be worked by what are in effect imprest funds, or
preferably, that as much as possible of the cash disbursements
shall be made direct from the main office.

Under either system it will be necessary for the works or
branch to requisition what monies they require from the
head office for wages and salaries as there is no other place
at which the disbursements of these sums can be made than
the actual place where they are earned. Cheques for the
amounts required to be disbursed will be paid into the works’
banking account, and the receipts for the disbursements
will afterwards be sent to the head office for checking. This,
however, may be modified in part by an arrangement for
the payment of the wages of higher officials of the works or
branch direct from the head office, by cheque or other means.

It is possible, under the first of the alternatives mentioned
above, for money to be provided for the other disbursements
of works or branches—such as those for purchases of materials
—against requisitions supported by detailed lists of the
accounts which the works or branch have to pay. For
many reasons, however, it is advisable that payments of
money by works or branches should be reduced to a minimum.
Therefore so far as concerns purchases of materials or other
goods, or contracts for work, the invoices or certificates
should be received by the works or branch, checked,
authorised for payment by them and forwarded to the
head office. At the same time arrangements should exist
by which suppliers send their monthly statements of account
or other demands for payment direct to the head office,
who will issue cheques in payment directly to the suppliers.
Under this system there is a fairly adequate safeguard
against collusion or fraud, while at the same time there is
an added security against error from the book-keeping
point of view.