Lecture I. Liquidator. In voluntary In compulsory The creation of the Official Receiver's department has been proved to have been quite unnecessary, and has already fallen into public disfavour. At the first meeting of creditors a Trustee can be appointed, either under a scheme of arrangement or in bankruptcy, the creditors in the latter case passing a resolution to adjudicate the debtor a bankrupt. The duties of a Trustee under the scheme of arrangement are prescribed by the scheme itself. The Trustee under a bankruptcy has to realise the estate, and distribute it among the creditors as quickly as possible. In both cases he has to submit his accounts for audit to the Board of Trade. The liquidation of public companies is now almost entirely entrusted to Chartered Accountants. A public company may be wound up, either voluntarily, with or without the supervision of the Court, or compulsorily, and windings-up in the latter case are attached to the Chancery Division of the High Court of Justice. A company is wound up voluntarily when the shareholders themselves at an extraordinary general meeting pass either an extraordinary or special resolution to that effect; and they can appoint a Liquidator, with or without security, to realise the assets and distribute them. In this case the Liquidator has to call a meeting of the shareholders annually until the liquidation is closed, and lay his Accounts before them. During the progress of the voluntary liquidation it is open to a creditor, or any person interested, to apply to the Court for the liquidation to be continued under the supervision of the Court, or for a compulsory winding-up. In the former case there is liberty to apply to the Court when thought desirable, and a Liquidator frequently takes advantage of this power to avoid responsibility. When a company is wound up by Order of the OF THE UNIVERSITY OF CALIFORNIA THE PROFESSION OF A CHARTERED ACCOUNTANT. 19 Court, two meetings are held, both presided over by the Lecture I. Official Receiver, who has been acting as Provisional Liquidator. One is a meeting of the creditors of the company, the other of the contributories or shareholders, and, should both meetings decide on the same person to act as Liquidator, he receives the appointment. Should, however, each appoint a different person, the Official Receiver applies to the Court, who decides as to which of the nominees of the two meetings shall be selected, or it may select a third person to act as Liquidator. The Order to wind up is almost invariably made on the petition of a creditor who cannot obtain payment of his debt, although the Court has power to order a company to be wound up compulsorily for other reasons. Accountant. As a rule a Chartered Accountant is appointed Reason for appointing Liquidator, and it is easy to account for this. The first Chartered duty of a Liquidator, after taking possession of the Company's property, is to prepare a list of contributories or persons liable to contribute to the assets of a Company in a winding-up. This can only be done by examining the books containing the entries of the capital accounts of the shareholders, and ascertaining, not only the amounts unpaid on the shares, but also whether the amounts stated as having been paid have been properly credited. The Liquidator's next duty is to investigate the claims sent to him in response to an advertisement stating the last day on which they can be received. Frequently before this can be done the books of the company have to be written up, being in arrear at the commencement of the winding-up; but in any case the claims have to be compared with the books before admitted, and when a difference exists, and the Liquidator is of opinion the claim is incorrect, he must be prepared to prove it so in Chambers or in Court. This requires a knowledge of Accounts seldom possessed by Lecture I Receiver in Respon- Practical necessary. any but a professional Accountant, and in order to avoid the double expense of appointing a person as Liquidator who has to employ others to do his work, it has gradually become the practice to confer the appointment upon Chartered Accountants. For the same reason Chartered Accountants are very frequently appointed Receivers in Chancery actions, where property claimed by two or more parties has to be protected until a decision has been given to whom it belongs, and a similar appointment is also made in what is known as a Debenture-holder's action, where a Receiver is appointed on behalf of the Debenture-holders of a company when their interest is in arrear, or the principal is not paid off when due and demanded. It is evident, therefore, that although the duties and responsibilities of Chartered Accountants are exceedingly varied, having regard to the nature of the appointments undertaken by them, yet they are nearly all conferred upon them as being experts in Accounts. The foundation, therefore, of the professional training is a knowledge of book-keeping, but the mastery of this subject leaves the student only on the threshold. A firstclass book-keeper may not possess the qualifications to enable him to undertake the position of a second-class clerk in a professional Accountant's office, but a perfect knowledge of book-keeping is requisite for the analysis of the books of account in the simplest investigation entrusted to a Chartered Accountant. This knowledge can be partly acquired by reading, but it must be supplemented by the experience gained during the period under articles; and the same remark applies to the legal portions of the training, by the experience acquired in attending at the Courts, the Chambers of the Judges, and the Official Receiver's department of the Board of Trade. Theoretical knowledge is not sufficient. A student who takes every opportunity of becoming acquainted with the details of as many individual matters as he can, will find his zeal well repaid in his future career. The initial work may be monotonous, but no duties fall to the lot of members of any profession which can be more varied or interesting than those of a Chartered Accountant. LECTURE II. THE PREPARATION OF THE ACCOUNTS OF AUDIT. Read before the Institute of Secretaries 21st December, 1892. Lecture II. The preparation of the accounts of a public Importance of Company for submission to the Auditors, which is subject to Directors, &c. practically required by the Articles of Association of every Company registered under the Companies Act of 1862, has not, so far as I am aware, ever received any practical attention at the hands of either directors or secretaries, although of the utmost importance to both class of officials. Companies with Articles I refer to the Articles of Association of Companies of Association. as requiring Accounts to be periodically prepared and laid before their shareholders after audit as it is a most singular omission from the sections of the Companies Act, 1862, which is practically the Act under which limited liability companies are registered, that with the exception of those companies which are not of sufficient importance to have Articles of Association of their own there is not only no provision whatever for the audit of Accounts, but, moreover, there is no provision for the publication of Accounts, or any direction that the shareholders are to be informed in any way as to the results of the transactions of their company. Companies For those Companies registered without Articles of |