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CLASSIFICATION OF LEDGER ACCOUNTS FOR CREAMERIES. 8 
never recegnized an accounting system as a vital assistance to the 
management. The real purpose of accounting is not only to show the 
board of directors, or proprietor, that the business has been conducted 
at a profit or loss, and that no fraud has been committed, but also to 
present facts concerning the business in such a manner that the man- 
agement may direct the operations intelligently. 
In securing the very best benefits possible from an adequate account- 
img 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 secured. 
(2) The financial records are carefully examined, and reports 
presented in the best possible form. 
(8) Opinion is rendered as to whether the methods in use could be 
improved and whether or not adequate reserves are being accumulated 
to care for depreciation, bad accounts, etc. 
The cost ef such an audit may seem prohibitive to some of the 
smaller organizations. However, this expense may be somewhat 
reduced by the formation of a cooperative auditing association, such 
as is NOW In existence In some sections of the country. It is strongly 
recommended that an audit of the kind referred te above should be 
made at the close of the fiscal year. 
Probably some organizations will not require all of the accounts 
shown in this classification. For instance, in a creamery holding 
no notes, neither the Notes Receivable account nor the Notes Receiv- 
able Discounted accounts would be used. Also, in small concerns it 
might be unnecessary to carry separate accounts for factory labor 
and office salaries, and other similar items. Some organizations may 
require additional accounts. The discussion in this bulletin should 
enable any creamery bookkeeper to set up intelligently a complete 
set of accounts. 
By comparison with U.S. Department of Agriculture Bulletin No. 
559, it will be noted that some of the procedure outlined therein 
differs from that described in this publication. These changes have 
been found desirable after observation of actual cperations extending 
over a period of several years. 
