Series 4 > Scottish industrial history

164 SCOTTISH INDUSTRIAL HISTORY
is not merely one of general deception of the Shareholders and
misrepresentation of the Company’s affairs: it is not merely deli¬
berate falsification of the Accounts from year to year, so as to shew
to the Shareholders and divide among them a Revenue which was
not in existence, and was known not to have been earned: but it
was a careful and most ingenious fabrication of imaginary accounts,
begun and carried on from time to time, for the purpose of sup¬
porting the falsified Half-yearly Statements of Revenue, and the
general misrepresentation of affairs. It thus became the immediate
duty of the Committee of Investigation to inquire as to the res¬
ponsibility for operations so discreditable, and leading to such
disastrous results.
In the Chairman’s circular letter of 14th September last, he ex¬
pressed himself as ‘unwilling to cast upon others responsibility
which attaches almost exclusively to’ himself. But the question
remained, how far the other Directors were cognizant of the
matter? Eleven of the Directors had anticipated the inquiries of the
Committee - ten of them, by a joint-statement, expressing their
entire ignorance of any irregularities in the Accounts, and their non¬
participation in such mis-statements, if any.
Auditors
The Committee afforded the Auditors an opportunity of making
explanations, and required the various officials of the Company to
produce all reports, letters, memoranda, or other instructions re¬
ceived by them, or in their custody, relating to the position of the
Capital and Revenue Accounts during any of the financial half-
years since 31st July 1862. The Auditors have satisfied the Commit¬
tee that the duties discharged by them have been laborious - that,
from time to time, they transmitted to the Board Memoranda or
Reports applicable to the half-yearly audit, which they understood,
to be qualifications upon the certificates that they signed, and that
from time to time, these reports had been partially given effect to
by corrections made during the ensuing half-year. These Reports
do not appear to have been laid before the Board, but to have been
handed to the Chairman to deal with. They also stated that the mass
of entries and number of books necessary to be examined within the
space of one, two, or at most three days, allowed them for verifying