No. 1. Boston Clearing House

Feb., 16, 19_

Dr. Massachusetts National Bank, Am't Rec'd, $245,137.32

Cr. " " " Am't Bro't, $302,234.41

Balance $-----------due Clearing House, $

Balance due the Massachusetts National Bank, $ 57,097.°9

F.H. Bender, Settling Clerk

When the proof clerk receives the balance tickets from the several settling clerks he immediately transcribes the debit exchanges (the amount received by any bank) in the Banks Dr. column, and the difference between the debit and credit exchanges in the Due Banks or the Due Clearing House column, as the case may be, on the clearinghouse proof. The credit exchanges having been previously entered, the proof clerk now proceeds to complete his proof. As the total exchanges brought must be the same as the total exchanges taken away, the debit and credit columns of the proof should agree if the work is correct, as also the total due banks and the total due the clearing house.

While the preparation of the proof is in progress the settling clerks are verifying their work by means of check tickets. If there are no errors in the clearing-house proof the manager announces the fact and the settling clerks return to their banks. If there is an error, and this is not infrequently the case, the proof clerk announces the difference to the manager. The manager then announces the difference to the settling clerks, who proceed to search for it. When this announcement is made the settling clerks have usually completed a revision of their statements, and can many times locate discrepancies as soon as they are announced-by the manager.

Various methods are resorted to in locating differences. Usually the manager calls for an exchange of sheets to the right or to the left for an examination of footings, and in cases where an error in entry is apparent the amounts are called back. This revision is final, and if the additions are correct it must make the proof balance.

The accompanying Clearing-House Proof and Settling Clerk's Statement are actual forms used in transactions at the Boston Clearing House.

Debtor and Creditor Banks. - Thus far no money has entered into the exchanges at the clearing house. The clearing, however, is not yet complete. If the total of the items brought to the clearing house by any particular bank is less than the total of the items brought by other banks against it, the bank owes the clearing house the difference between such totals. On the other hand, if the items brought to the clearing house by any bank are greater than the totals brought against it, that bank is entitled to receive from the clearing house the difference between such totals. To complete the clearing, therefore, it is necessary to make settlement for the debit and credit balances.