14
and that a Conference with the "ar Office and
Treasury is to be preceded by a little domestic party of our own. I hope that somebody will arrange it and that you will come to it. As we have promised the Governor a reply before the end of this month, this party ought to take place at an early date.
TP.V.V.
2/12
Mr.Vernon,
If the principle is adopted for the
Colonies generally, and also applied to Hong Kong,
that the value of investments should be shown in
the Balance Sheet of the Colony at their current
market value at the date of the Balance Sheet
instead of at cost price when purchased, I agree that it would be correct, from the accounting
point of view, to apply that principle to Hong
Kong sterling investments and to adjust the
differences between the market value in dollars
at the date of the last Balance Sheet and the
market value in dollars at the date of the new
one, whether those differences are due to variations
in the sterling values of the investments or to
variations in the dollar-sterling exchange or to
a combination of both.
So long as the old rule of showing invest-
ments in the Balance Sheet at their cost price
was adhered to, the "Adjustment of Exchange
Account" was, I think, justified and correct.
It certainly had the
-
intended
<<
result of not
burdening the Colonial Government with a
military