Pete,
Maybe the old accountant didn't understand the "difference" and just
thought he did! According to Webster's, draft in that context, is the
synonym of check. There is a difference when you obtain a draft from
a bank, as the RPL&N did. In that case, money from yours or the RR's
account is transferred immediately, where as with a check, the
transfer doesn't occur until the check clears your bank. In those
days, that was a considerable time period, maybe 5 - 10 days. During
the period between issue and clearing of the check, you or the RR
still have use of the money in your account, sort of a float.
In the case where you wrote and issued the draft, it won't "clear'
any faster than a check issued at the same time. Financially, there
should be no difference. However, it may be that the RR accounting
principles at the time may have required that the draft was entered
into the RR's ledger differently than was a check. They may have had
to show the money as no longer available, even though it was still in
the account. The check probably wasn't entered into the ledger until
it was cleared. Under that condition, the "money" would still be
available. Except if the money is invested and earning interest
during the process period, there would not be any financial
difference. Even if the money is shown as "off the books" in the
draft scenario, it is physically still in your account until the
draft clears. Banks drafts, years ago, were considered "more secure"
since the money had already been transferred from your account. In
other words, the recipient knows the money is there.
Frankly, if you could issue either instrument, I am not sure why the
RR made both available. Were there guidelines as to when to issue a
draft and under what circumstances?
Bill Barber
Gravois Mills, MO
On Jun 5, 2011, at 2:35 AM, CBQ@yahoogroups.com wrote:
> Re: Shipping human remains by rail
> Posted by: "Jpslhedgpeth@aol.com" Jpslhedgpeth@aol.com petehedgpeth
> Sat Jun 4, 2011 4:52 pm (PDT)
>
>
>
>
> John et al
>
> I trust that this little discussion will impress the "younger
> generation" as to the intricacies and all the intimate details of
> railroad and station accounting procedures. It's unbelievable the
> detail the railroads went to to account for "every little thing".
> If it was done there were instructions somewhere that covered the
> matter..And "woe be unto" the new hire who didn't know of or follow
> the instructions.
>
> I once incurred the wrath of an old time accountant at the Rock
> Island by writing a draft to the CB&Q to pay for tickets for two
> car inspectors we were sending out to testify in a court
> case......DON'T YOU KNOW YOU DON'T EVER WRITE A DRAFT TO ANOTHER
> RAILROAD he yelled at me when the cleared draft came over his
> desk....He berated me for some minutes for my ignorance of railroad
> procedures.
>
> For the record my ignorance is still in full bloom in this
> matter...Although it has been explained to me many times I still do
> not know or understand the difference between a CHECK and a DRAFT
> To this day I can remember the agent on the RPL&N saying he was
> going uptown to the bank to get a DRAFT.
> I know no more about these matters now than I did 60 plus years ago.
>
> Pete
[Non-text portions of this message have been removed]
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