A SUKVEY OF TYPICAL COOPERATIVE STOKES. 19 
a regular audit is made. Of these, 13 required that the audit be made 
weekly, 11 monthly, 3 bimonthly, 2 quarterly, 3 semiannually, and 
10 annually. In addition to these, several others stated that they had 
an audit at more or less irregular intervals. When questioned as to 
the auditors, 21 stated that the auditing was done by a committee 
elected from the membership, while IT reported that the services of 
a professional auditor were secured. When further questioned as to 
the cost per year of the auditing, only 15 stores reported a regular 
outlay for this purpose. Of these, the highest gave an annual cost 
of $300, while the lowest was $30, the average for the 15 stores being 
$56 each. 
The results of this survey demonstrate that the precariousness of 
the cooperative mercantile business is due to inefficient accounting and 
auditing more than to any other single cause. Where complete records 
are kept of the business, and where these are used as the basis of a 
regular monthly financial report, there is furnished a continuous 
barometer by which a board of directors can take warning at the first 
signs of mismanagement or failing business. In addition to this, at 
the end of each fiscal year some competent outsider, preferably a cer- 
tified public accountant, should be hired to audit the records for the 
year. 
Of course it must be recognized that efficient bookkeeping and ex- 
pert auditing cost more than the small cooperative business can 
afford. Much progress toward efficiency, however, may be secured by 
the adoption of some simple standardized system of bookkeeping and 
business practice that will give complete and accurate records which 
can be easily interpreted. To meet this need the United States 
Department of Agriculture has devised a system which is described 
in Department Bulletin No. 381, entitled " Business Practice and 
Accounts for Cooperative Stores." 
The auditing committee elected by the members should not under- 
take to do the annual auditing itself , unless it enjoys the rare advantage 
of having a certified public accountant in its membership. The mem- 
bers of the committee should know enough of bookkeeping to appre- 
ciate the necessity of accuracy. They should see to it that this is 
accomplished, and the association should make provision for the 
necessary expense. 
These conclusions have been borne out by the long experience of 
the Rochdale stores in England. Their experience is summarized in 
the preface to "A Manual of Auditing," published by the Coopera- 
tive Union (Ltd.), with headquarters at Manchester, England, for 
the guidance of the societies. The author says: 
It is essential to the interest of members of societies generally that great 
attention be paid to the importance of strict audit, first, for self-protection ; 
