2 BULLETIN 985, U. S. DEPARTMENT OF AGRICULTURE. 



To do this, one must carefully read the bulletin before starting any 

 actual work. That portion beginning on page 14, under the heading 

 "How the system works," and the sample entries on the forms at 

 the back, will be especially helpful. In the day-to-day work of 

 keeping the records, the Appendix and the sample entries will answer 

 practically every question which will ever occur to the user, and the 

 Bureau of Markets is at all times ready and willing to answer questions. 

 There is no short cut to adequate information relating to the 

 operation of any business. The only way is to install a good set of 

 records, open the proper ledger accounts, and keep them correctly. 

 Then the results must be studied. The information in this bulletin 

 will enable a business man of average intelligence to do these things. 



RESULTS OF USING THE SYSTEM. 



A large number of business men look upon their bookkeeping as a 

 sort of necessary evil, from which they can get no return. The 

 information which a properly kept set of records and accounts can 

 furnish, however, is the guidepost along the highway to business 

 success. If one would succeed in his business probably no other tool 

 will help more than a system of bookkeeping which will give the 

 results herein described. 



The final test of the adequacy of any system of accounting lies in 

 the question whether or not it will furnish the information neces- 

 sary for the intelligent conduct of the business. This information 

 should consist of a statement of the financial standing (Balance sheet, 

 see page 4), a statement showing the loss or gain as a whole (Income 

 and expense statement, see page 6) , prepared in such detail that the 

 relation of the various items of income and expense may be readily 

 seen, and any other information that may be of assistance to the 

 management. It should also make it possible to prepare income tax 

 reports with comparatively little work. 



An illustration of each of the reports essential to a ginnery follows, 

 with a few comments concerning each report. 



To obtain the very best benefits possible from an adequate account- 

 ing system, nothing can take the place of an independent audit by a 

 reputable firm of public accountants. Some of the advantages to be 

 derived from such an audit may be summarized as follows: 



(1) An impartial and disinterested opinion of the general policy 

 and administration of the business is obtained. 



(2) The financial records are carefully examined, and reports pre- 

 sented in the best possible form. 



(3) Opinion is rendered as to whether the methods in use could be 

 improved and whether or not adequate reserves are being accumu- 

 lated to care for depreciation, bad accounts, etc. 



