A (2) 10
immediately by the Public Works Department, and that that Department should have assumed complete responsibility for their custody and the accounting for of receipts from sales.
52. Further the arrangement which permitted the Resident Engineer, to dispose of the plant, which was of considerable value, on a commission basis, and without requiring any Government department to exercise supervision and control over the matter is, in the opinion of Audit, open to objection. It is also contrary to the usual Government method of disposal of surplus stores. It must also be noted that after the scheme had been completed the Resident Engineer could in no sense be considered a Government official.
53. The apparent failure to issue in the first instance any special instructions regarding the method of accounting for moneys received from sales was unfortunate. That definite accounting instructions were necessary, and close supervision was desirable, became evident after certain accounting irregularities regarding the disposal of proceeds of the sales of plant had been accidentally disclosed during an audit of the Imprest Account.
54. The first move in the taking over of the plant by Government was apparently made in January of the present year, when Audit was informed that it would be transferred to the Public Works Department, but that the Resident Engineer would retain first call on it for remedial work which it had been found necessary to undertake at the Pineapple Pass Dam. It was also stated that he would continue to have the right to sell plant on commission provided that no sales at less than catalogue prices were effected without Government approval.
55. At a later date however Government for various reasons considered it advisable to defer its transfer to the Public Works Department.
56. A question regarding the apparent non-payment of hire charges for a derrick forming part of the Shing Mun plant, which it appears was loaned some time ago by the Resident Engineer to a private company, has not yet been explained to the satisfaction of Audit.
57. I. STATEMENT OF ASSETS AND LIABILITIES.
The excess of Assets over liabilities at the
31st December, 1937 was
As compared with at the end of the
previous year
$ 14,002,278.11
12,917,132.29
Showing an increase of
$ 1,085,145.82