ments drawn to show the average balances maintained over a period of six months or more immediately preceding, the balance on the day reported, and enough of an abstract of the accounts to show, if possible, the cause of the fluctuation.
4. Marking the Mail. All incoming letters containing cash items are carefully examined by a special clerk to determine how much of the total letter interest credit must be deferred. To do this work requires a comprehensive knowledge of the manner in which every item handled is collected, and great care must be exercised to protect the bank against loss by paying interest on funds which are in process of collection.
A list of all sight drafts and country checks deposited over the counter is also sent to the analysis desk for the same purpose. Report of interest delays is made to the general bookkeeper's department.
Nature of Telegraphic Communications A reserve city bank uses codes to cover almost all transactions with correspondents. These codes serve: r. To reduce the cost of telegraphic communication.
2. To provide a certain secrecy for the operation.
3. To provide against errors in communications.
4. To assure proper authentication.
This work corresponds to that of the cable department of the foreign division, which handles codes, cables, and telegrams aris ing from foreign business. The codes are furnished to corre spondent banks and to some individuals who frequently request the bank to make payments or transfers for them. This bank, in turn, holds the codes of other banks furnished by them. The codes and test words are devised and handled by a special clerk or department. Great caution is taken to keep them secret; the issuing bank requests the correspondent to keep the code where it will be accessible only to the officers of the bank or other persons authorized to use it. When the account is closed, the code is recalled. It is essential that the test words be figured and used correctly; neither the correspondent nor the bank will pay or act upon a telegram not properly authenticated by test words, and at once wires for information; this causes delay and expense.
All outgoing telegrams for all departments of the bank are handled by this specialized clerk or department. The messages are coded and then retranslated and carefully checked with the translation. Telegrams requesting payments or transfers of money and all those in which special instructions or advice are given require test words. These are supplied by the officer in charge of them, upon an order initialed by the person sending the telegram and by the department in charge of the codes.
In the morning the incoming telegrams that have accumu lated from the close of business the previous clay as delivered by the telegraph companies are received and time-stamped, and the open messages separated from those in code. The coded mes sages arc translated by a clerk and the translation checked by another clerk to reduce the possibility of error. Test word tele grams arc sent to the officers in charge of test words, for checking the test words. The department then distributes the telegrams to the proper departments against signed receipt bearing a num ber; as the receipts are returned, they are time-stamped and filed with the relative stub. The same procedure is followed for other telegrams arriving during the day.
Bills are rendered once a month by the telegraph companies for messages sent and received; these are checked by the tele graph operator and all differences adjusted before settlement is made. A clerk in the department allocates these charges, and, where the agreement with the client runs to that effect, puts through tickets charging the account or prepares and sends a bill to him; otherwise they are charged to the Correspondents' Expense account.
Telegraphic Payments, Transfers, and Deposits With this department will naturally be lodged the work of making payments, transfers, and deposits on telegraphic instruc tions. For instance, bank A of Chicago telegraphs the bank as follows: "Charge our account and pay to bank B of New York $io,000 for credit of bank C of Lynchburg, Virginia." This telegram is time-stamped, translated, and checked against the translation, and then tickets are prepared charging A and credit ing Cashier account $10,000. A telegraphic advice is sent to A and a letter of advice sent by mail. A cashier's check is then drawn payable to B for credit of C, and to it is attached a form requesting that the bank's messenger be given a letter of advice by B. A hold is put against A's account. A's balance is ob tained from the bookkeeper. The debit ticket goes to the general bookkeeper and later to the check desk department. The cashier's check is delivered by messenger to B. B's letter of advice is checked against the telegram; and, if in order, B's advice and the bank's advice are enclosed and sent to A. Payments to individuals are handled in a similar manner.