Chapter 312: Classification and Subordination
Old 5 pointed toward the wooden staircase leading to the second floor.
"We’ve kept the main room empty as a vault," said Old 5, pulling a small ledger from his robes. "We knew they’d eventually send a squad leader, so we didn’t want the hassle of getting kicked out of our quarters later and kept it ready for you. Here you go, this is the accounting book. We kept all the capital in gems and only bought the building and a few supplies; everything is detailed inside, Squad Leader."
"Good work," said Alexander, taking the ledger.
Without wasting any more time, Alexander began walking up the steps, giving the ropes a firm tug to force the three bound women to trail behind him into the main room.
Alex opened the door to the main room and found three large, reinforced wooden chests resting against the wall. Stepping closer to open them one by one, he saw they were filled to the brim with glowing gems. Alongside the crystals sat several gold items, diamond-studded jewelry, and even some fine pelts and high-value paintings; just as they had said, they kept everything in physical assets to prevent capital devaluation.
He flipped open the ledger Old 5 had handed him and turned straight to the final page, where the current balance was listed.
Current Capital: 950,000 gems.
Looking over the breakdown of numbers, he saw that among the most significant expenses was each member’s salary. According to what was written, each of the five members earned 30% of the net profits and handed 50% over to the main treasury, while the remaining 20% went toward an expansion fund.
That expansion fund had already been put into motion. The report detailed that they hadn’t just bought the tavern structure itself, but also the five neighboring houses, which were under renovation to expand the business. There were even attached notes indicating the estimated staff needed for the grand opening:
25 Yellow-class male escorts
75 Green-class male escorts
250 Blue-class male escorts
They were planning a truly colossal expansion. Tucked alongside the notes were the blueprints for the renovation and the purchase contracts for the adjoining properties.
"Damn, looks like they didn’t waste any time," said Alex under his breath, examining the sheets. "Old 5 is pretty methodical... but luckily I’m a financial expert and I can see where he’s trying to screw me over. The numbers don’t add up, Old 5."
He snapped the book shut and turned toward the three prisoners, who remained bound in the middle of the room.
"Wait here for a moment," Alex told them in a serious tone. "I’m going downstairs to check a few things with the old man."
Alex walked down the wooden stairs with the ledger tucked under his arm, an unreadable expression on his face. The five men were still on the ground floor; seeing him descend, Old 5 set his cup down on the bar and looked over attentively.
"Old 5, can we go over something in this book?" asked Alex, resting the notebook on the central table.
"Of course, tell me, Squad Leader," answered Old 5, calmly stepping closer. "I hope I managed to keep the accounting properly."
"Actually, yes, quite well. You were very meticulous," said Alex, opening the book to the financial sections. "But a few specific details caught my attention."
Alex tapped his index finger against the page and locked eyes with the older man.
"According to the gross revenue breakdown, the tavern generated 2.4 million gems this past quarter. Applying the formula you logged, 50% goes to the treasury, 30% is split among the five members, and the remaining 20% is allocated to the expansion fund. That means the expansion fund should have received 480,000 gems."
Old 5 nodded listening intently.
"However," continued Alex, quickly flipping the page, "the purchase contracts for the five adjoining properties total 180,000 gems, and the approved renovation estimates don’t exceed 120,000. In total, the capital investment spent on the expansion sits at 300,000 gems. Subtracting that from the accrued fund, there should be a surplus of 180,000 liquid gems recorded in the treasury, on top of the 950,000 sitting upstairs in the chests. Yet, in the final balance, you only report the net capital without the remainder from the amortization line item."
Alex crossed his arms over his chest, leaning in slightly.
"We aren’t talking about a simple 2% or 3% discrepancy from tax fluctuations or minor operating costs, Old 5. Nearly 15% of the total net margin from the reserve fund is completely missing. Money is missing, and it’s not a small amount. Where is that remaining balance?"
Old 5 let out a long sigh, running a hand over his face as a faint smile formed on his lips upon seeing the new leader’s sharpness.
"You’re right to doubt the figures, Squad Leader," said Old 5, keeping a calm tone. "But allow me to explain the reasoning. Every quarter we must hand over 50% of the net profits to TMC. The last payment was made nearly two and a half months ago, so those funds have already been set aside as they were collected. And regarding that 20% from the expansion fund... not everything gets logged in this ledger for obvious reasons, but it’s understood among us. That money doesn’t go into our pockets, if that’s what you’re thinking, but rather straight into bribes."
Alexander raised an eyebrow, listening closely.
"We are the most lucrative business in this entire city," continued Old 5, stepping slightly closer to lower his voice. "Lysandra may be a powerful woman and the official mayor, but she has quite a financial appetite. Every month we hand over nearly 15% of our total profits to operate without interference. She maintains a full audit on us at all times; there are eyes and ears everywhere, so we don’t even bother hiding the real numbers from her agents."
"I see," said Alexander, snapping the accounting ledger shut with a firm thud while nodding. "An operational cost to maintain political protection and freedom of movement. Good work, Old 5. I’m glad to see there are no losses due to negligence."