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of the Military Contribution assessed as at present.

If the proposed undertaking is such that additional revenue

will be earned thereby the estimate of the latter has to

be reduced by 20%: if, on the other hand, new revenue

is required in order to finance it, the yield must be

greater by 25% than the amount actually required. Furthermore

if there is a choice between getting work done by

Government or by private or semi-public institutions the

decision between the two may be affected by the possible

effects on the Military Contribution payable. There has

been for example of late years a tendency for private

charitable institutions to rely more and more on Government grants (e.g., the Tung Wah Hospital and Associated Chinese Charities and the Hong Kong Benevolent Society) and

there is something to be said for a great deal more

Government participation in such charities. The same

is largely true of the University of Hong Kong. If,

however, necessary funds can be collected from private

subscriptions no Military Contribution is payable whereas

if they come from a Government grant and therefore

indirectly necessitate increased revenue additional

Military Contribution is paid.

9.

The other main class of difficulties are

complications in the keeping of Government accounts. These

are innumerable. Often they merely cause extra work

without having any wider effects. In other cases they

necessitate special consideration and possibly legislation

before accounting rules intended for general use in the

Colonial Empire can be applied here, as e.g. in the

recent cases of the new accounting procedures in relation

to revenue refunds and unallocated stores. The following

are, however, cases in which the accounting difficulty

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