and their application in municipal book-keeping, I will now refer to the large charts here upon the wall. Explanation of These charts have been prepared for the purpose of illustrating on a scale comparable with the revenue expenditures of a city like New York the entries necessary to establish proper methods of revenue accounting in the books. In order not to complicate the matter, which is sufficiently complicated at best, only those entries have been illustrated which are fundamentally necessary in order to establish the simplest form of a monthly balance sheet. The amounts set forth on the charts correspond closely enough to the actual expenditures of the city of New York in a recent fiscal year, but no emphasis whatever should be laid upon these figures or any of them. I wish to lay stress solely upon the form and the methods of making the entries and the corresponding ledger accounts which are thereby set up in books and which give automatically a correct balance sheet at the end of each fiscal period simply by taking off a trial balance of the general ledger. Schedule 1 is a title-page merely. Schedule 2 exhibits a journal entry debiting "Revenue Account 1910" and crediting " Appropriations Account 1910" with $130,000,000.00, representing the expenditures authorized to be made from taxes and all other revenues during the fiscal year. This journal entry is given in detail under the standard classification established by the Bureau of the Census, and applied by it to the annual reports of all cities throughout the country as published in the Census bulletins. These detailed appropriations will be set up in a subsidiary ledger, appropriation ledger; and this subsidiary ledger will be controlled by the "Appropriations 1910 Account" in the general ledger. SCHEDULE 2. Journal. January 1, 1910. Annual budget for the year 1910. Estimated by the Board of Estimate and Apportionment and passed by the Board of Aldermen. Required to pay the expenses of conducting the public business for the ensuing year. Schedule 3. The accounts in the general ledger are exhibited as they would appear after the journal entry on Schedule 2 has been posted. There is also given as an illustration of the subsidiary “appropriations" ledger one account-Mayoralty. Schedule 4 exhibits a journal entry establishing the credit to “revenue account 1910" and setting up on the other side as an asset the tax levy of 1910 and the "estimated other revenue" as established by the budgetmaking body. There is further established by credit entry a “reserve for abatements" account. A reserve account of this nature is fundamentally necessary in municipal bookkeeping, in order that provision may be made for abatements of taxes and other losses of taxes which always occur in municipal finances. If such abatements and losses are not properly provided for by the tax levy itself, they must be made up by additional borrowings, which must become burdens upon the revenues and tax-payers of the future. SCHEDULE 4. Journal. CREDIT TO REVENUE FROM TAX LEVY AND OTHER RECEIPTS TO BE COLLECTED. Tax levy of 1910....... Estimated other revenue To revenue account 1910 To reserve for abatements (overlay) $110,250,000.00 $135,000,000.00 5,250,000.00 66 Schedule 5 shows the condition of the general ledger accounts after this journal entry. It will be noted that the Revenue Account 1910" now stands with a credit balance of $5,000,000.00. |