On the 30th of June, 1862, I had on deposit

with the Treasury.................................. $172, 991 47

I received the year ending June 30, 1863.......... 2,509, 383 13

---------------

Total to be accounted for......................... 2,682, 374 60

Amount of disbursements during the year........... 2,416, 237 60

---------------

Balance due United States June 30, 1863........... 266, 137 00

Of this balance $265,687.51 was deposited in Washington with the Treasurer of The United States, and $449.49 in New York City with the assistant United States treasurer. Of the $2,416,237.60 disbursed during the year, $2,406,285.21 was transferred to officers of my department for disbursements in corps. The balance, $9,952.39, was expended for articles of stationery, &c., purchased, and payment of employes. To the great credit of the quartermasters of this army, I have to report only one instance of defalcation and want of integrity. That is the case of Captain John Howland, assistant quartermaster volunteers, who received from me in March last $16,470.04, as acting chief quartermaster or the Fifth Corps, for distribution to the subordinate officers to pay teamsters. He deserted and carried away with him the whole sum, but was subsequently arrested and brought to Washington by some of the acute and efficient agents of the provost marshal of the War Department. Colonel Baker recovered $10,279 of the sum embezzled,

and turned the same over to me. Captain Howland has been brought before a court-martial for this offense. The sentence is not yet promulgated.

There were no outstanding debts in this army on the 30th of June, 1863. I do not mean unsettled claims for forage, &c., in Maryland. I left Captain John McHarg, assistant quartermaster, at Frederick, with funds to pay all such legitimate accounts. He is still there on this duty.

There will be suggestions for the improvement of our means of transportation, workshops, &c., by some of my experienced subordinate officers. I request you will give the matter your attention. There should be at once, above all other things, a special wagon or caisson for carrying all extra or reserve ammunition. This matter is very important. It should be for small-arm as well as artillery ammunition.

I have the honor to include herewith a forcible letter on the subject, marked C, to which I invite your attention, from General Hunt, chief of artillery.*

I should not close this report without acknowledging the uniform generosity which you have extended to me, and the great support you have invariably given me. I wish also to acknowledge my great obligations to General Rucker, and the officers who have served under him. He has had daily contact and business with, and on account of, this army, and has, in all instances, fully met our expectations with much courtesy and forbearance. For all that has been accomplished there is credit due many who have labored together instead of arraying obstacles. I have not permitted myself to have difficulties with any one who exhibited any will or capacity to serve this army.

To the quartermasters of this army I feel much attached and under a weight of indebtedness, especially to those who have had charge of the great depots. I have referred to them in the body of this report;still, I would be doing much injustice if I did not mention Captain P. P. Pitkin, assistant quartermaster, who, similar to Captain Pairce, has had charge of great depots, and whose business for the year has been

---------------

*To appear, under date of September 30, 1863, in Series I, Vol. XXXIX.

---------------