Section 6. Letters containing collection items for credit.
The letters may contain only cash items, or only collection items, or both cash items and collection items, for credit. If they contain both kinds of items, the collection items are deducted from the footing of the cash letter—if they are included therein— and listed on a form on which are written any special instructions received, such as advising payment by mail or telegraph and instructions as to protest, etc. The items are then handed to the collections clerk. However, if they are listed in a separate letter both the collection items and the letter are turned over to the collections clerk at once. He charges and distributes the items as follows: 1. The coupons, to the coupon collection department.
2. The out-of-town and up-town items, to the country collection department.
3. Notes, stock drafts, collections for remittance, foreign exchange items for sale and collection, lo the note teller.
4. Time drafts and special advice and other items on the home city, to the city collection department.
Proving the Cash Letters The method used in proving the cash letters is the "batch" method. When a sufficient number of checks is received in one or more letters, they are proved in batches, called "racks," by dividing the items, say, as follows• I. Clearing house checks.
2. Checks on the bank itself.
3. Checks on trust companies not members of the clearing house.
4. Country checks and checks on the Treasury of the United States.
5. Sight drafts.
6. Sundries.
The totals of these subsections are listed on a proof (Figure 14), on which is stamped the rack number, and they should equal the sum of the letters. The proof would be as follows: After the batches are proved, the clearing house checks are stamped by machine and sorted into the rack according to clear ing house numbers. No time need be taken to examine indorse ments; if any check proves later to have been irregular as to in dorsements, it can be traced more easily than a similar one in the paying teller's department, since it is described somewhat in the cash letter and the bank may rely upon being able to fall back on its correspondent bank to make good irregular and forged checks. To make the tracing of checks convenient for themselves and their metropolitan correspondents, some out-of-town banks put the transit number of the bank on their checks.
The other packages are listed on a separate proof in totals and distributed as follows: i. The trust companies and sights, to the city collection department.
2. The countries and checks on the United States Treasury, to the transit department.
3. Checks on the bank itself, to the check desk department.
4. Cash, if any to the mail teller, who signs for it on the original letter.
5. The cash return items, to a clerk whose special duty is to prove the cash return items, including those listed in the cash letters.
The cash letters are stamped with the date and section num bers and handed to the accounts current men who are present to post their ledgers. The letters are run up on adding machines and should prove with the rack figures for those letters.
The clearing house checks are listed and examined for "sent wrongs," as the clearing house imposes fines for checks or pack: ages sent to banks for which they are not intended. All package totals are copied on a clearing house sheet, which is divided into, say, five sections, grouped according to clearing house numbers, and the packages are forwarded to the assembly rack.
The New York Clearing House provides for an optional nine o'clock clearing, in which a large majority of the members par ticipate. This early clearing greatly facilitates the work of the banks, whose volume of business has tremendously increased in recent years. The figures for this early clearing are included in the regular ten o'clock clearing and a receipt is given at the time of delivery.
The Assembly Rack Proof The assembly rack in the morning receives the packages of the P. AL rack and also the packages of the banks for which the bank acts as clearing agent; before going to the assembly rack these packages also are divided into sections similar to those on the clearing house sheet, as described above. A separate assembly rack proof (Figure 15) is kept, on which is listed the totals of each section from the various racks, as well as those of the banks for which the bank clears, and those additions which the clearing house allows. These additions consist of large items taken from letters received late.