-13-
respectively.7 By memorandum dated September 13, 1982, SSI’s
controller, Tom Basti, hereinafter sometimes referred to as
Basti, listed petitioners’ income from SSI for 1981 and for the
first 6 months of 1982 as $206,336.60 and $437,592.15,
respectively.
SSI’s principal bank account was in Central Trust Co.; it
was used primarily as a depository for Chartered Representative
Fees and SSI client funds. SSI also had accounts in other banks.
In 1981, 37 checks and 1 wire transfer, totaling $129,285.67,
were drawn on SSI’s Southern Ohio Bank account to petitioners or
to third parties on petitioners’ behalf; the entire amount was
1981 income to petitioners.8
7 Monica’s memorandum states that the report was prepared
on a cash basis. This one-page memorandum was introduced through
Monica on direct examination by respondent. Later the same day,
on cross-examination by Robert, Monica testified that SSI used an
accrual method of accounting; we have so found. The parties have
stipulated, and we have found, infra, that SSI prepared and
maintained substantially all of its books and records
contemporaneously. We have not found in the record an
explanation of why Monica would have produced a cash basis report
while contemporaneously maintaining, or overseeing the
maintenance of, accrual basis records.
8 The parties’ stipulation lists 40 checks and 1 wire
transfer. Respondent’s proposed finding omits three of the
checks. We treat this as respondent’s implicit concession of the
$8,797.39 total of these three checks.
Respondent’s proposed finding lists each of the remaining 37
checks and 1 wire transfer, but incorrectly shows the total
amount as $120,285.67. The parties stipulated to the amount of
each check and wire transfer. The $9,000 error in the total
probably stems from a transposition of two digits during the
(continued...)
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