(22)
Mr. Bird. I think that as the Auditor you should have insisted upon the balances being made out.
A.—Yes, I ought to have reported the neglect to the Government.
Q.—Did you insist in writing to the Treasurer that the balances should be made out? A—No, I simply mentioned it in conversation.
Q—You really could not audit properly?
A.—No, not unless there was a balance made out. You will allow me to say one thing and it is this. As I have told you before my audit consists in going to the Treasury and checking the amounts received month by month into the Treasury, but there is no annual account ever comes before me for audit. I make a monthly check but there is no annual account. If I had seen the annual account it would have impressed the want of a balance on my mind, although I admit that in neglecting to really insist upon its being done I was wrong.
The Chairman—You arrived, Mr. Nicolle, in 1890?
A.—In 1890.
Q—Would you consider it part of your duty to see that the book of 1889 was balanced?
A.—No, I should not have gone back beyond the time I actually came here. I was given this book for 1890 to examine and I had a look at the 1890 Rent Roll, I never looked at any book prior to 1890.
Q—When did you say anything about the want of a balance?
A.—It was during the years 1891 and 1892 that I mentioned that the books were not balanced. I remember distinctly saying once to Mr. May something about it and he spoke to Alves and Alves came to me and said "Well, I am so frightfully busy I must take these books home and write them up there."
Mr. Thurburn. That is how he was able to destroy the previous books? A.—That I do not know.
Mr. Bird. He had charge of the books?
A.—Yes, the current books were kept in the safe.
Q. And the old books?
A.—Were lying about.
Q.—Under lock and key?
A.—No.
The Chairman.—So far as you possibly could examine the books and check them, you did?
A.—Yes, I did as far as I had time, but please remember that during 1890 my staff consisted of Mr. Ribeiro who was very old and not up to his work. During 1891 before Mr. Taverner came I had to teach him every single thing and take him round to the different Offices to show him the sort of examinations I had to do, and in September I gave him a fortnight's leave to go to Shanghai, and from that time up to January I had no assistance whatever.
Q—So far as the Treasurer furnished you with books and vouchers you checked as far as you could?
A.—Yes.
Q.—And your checking did not disclose the defalcations because the book was not balanced?
A.—Yes.
(23)
Q.—And as long as the book was not balanced however minute may have been your examination the system followed by Alves would screen him until the book was balanced? A. Yes, unless I happened to light upon one of the cases in which he altered the receipt as I eventually did.
Mr. Thurburn.—Is the book for assessed taxes similar to this for Crown Rents? A.—It is not kept in this form.
Q.—Is it a book that can be balanced?
A.—It is now.
Q—But it was not?
A.—No.
Q.—Therefore the same thing might have happened in connection with that?
A.—It could not now.
Q—But it could during 1890?
A.—Certainly.
Mr. Bird. Mr. Mitchell-Innes signs all the taxes receipts himself? A.—Only lately he has done so.
Q—Previous to that do you know whether it was possible that there could be a deficiency like this one?
A.—Quite possible. I have only given a test audit to this, not more than that.
Q—Who signed the receipts for taxes before Mr. Mitchell-Innes?
A.—The officer in charge of the taxes, formerly Mr. Madar and the chief clerk, Mr. Carvalho. It was during Mr. May's time that the Treasurer began to sign receipts. On my visits to the Treasury I asked that the book for the assessed taxes should be altered in order that the balance could be made and the Treasurer said that it could be arranged. They misunderstood me, however, and I had to write in 1892 asking that the book might be altered, and then they started a new form of book.
Q—You brought the matter to the notice of the Government?
A.—To the attention of the Treasurer. I also reported home to my Chief the difficulties I had.
The Chairman.—Supposing that this book (Crown Rent Roll) was written up day by day how long do you think it would take a clerk beginning on the 1st of January to balance it?
A.—I should think with the present staff about three weeks. A smart man might do it in a fortnight.
(Book produced and examined.)
Mr. Bird.—I don't think it matters whether it took one day or three weeks. It ought to have been done.
The Chairman.—If the book was kept up from day to day it would not be a very difficult work to do at the end of the year.
A.—It is kept up from day to day.
The Chairman.—We have to find out the causes that rendered the defalcations possible and those that prevented their earlier detection.
Witness.—Want of balancing.
Mr. Thurburn.—Another cause was a want of proper checking in the Office itself.
( 22 )
Mr. Bird. I think that as the Auditor you should have insisted upon the balances being made out.
A.-Yes, I ought to have reported the neglect to the Government.
Q.-Did you insist in writing to the Treasurer that the balances should be made out'? A-No, I simply mentioned it in conversation.
Q-You really could not andit properly?
A.-No, not unless there was a balance made ont. You will allow me to say one thing and it is this. As I have told yon before my audit consists in going to the Treasury and checking the amounts received month by month into the Treasury, but there is no annual account ever comes before me for andit. I make a monthly check but there is no annual account. If I had seen the annual account it would have hapressed the want of
a balance on my mind, although I admit that in neglecting to really insist upon its being done I was wrong.
The Chairman-You arrived, Mr. Nicolle, in 1890?
A.--In 1890.
Q-Would you consider it part of your duty to see that the book of 1889 was
balanced?
A.-No, I should not have gone back beyond the time I actually came here.
I was given this book for 1890 to examine and I had a look at the 1890 Rent Roll, I never looked at any book prior to 1890.
Q-When did you say anything about the want of a balance ?
A.-It was during the years 1891 and 1892 that I mentioned that the books were not balanced.
I remember distinctly saying once to Mr. May something about it and he spoke to Alves and Alves came to me and said "Well, I am so frightfully busy I must take these books home and write them UP there."
Mr. Thurburn. That is how he was able to destroy the previous books? A.-That I do not know,
Mr. Bird. He had charge of the books?
A.--Yes, the current books were kept in the safe.
Q. And the old books?
A.- -Were lying about.
Q.-Under lock and key?
A.--No.
The Chairman.-So far as you possibly could examine the books and check them, you did?
my
staff
A.--Yes, I did as far as I had time, but please remember that during 1890 consisted of Mr. Ribeiro who was very old and not up to his work. During 1891 before Mr. Taverner came I had to teach him every single thing and take him round to the different Offices to show him the sort of examinations f had to do, and in September I gave him a fortnight's leave to go to Shanghai, and from that time up to January I had no assistance whatever.
Q-So far as the Treasurer furnished you with books and vouchers you checked as far as you could?
A.--Yes.
Q.--And your checking did not disclose the defalcations because the book was not balanced?
1.-Yes.
( 23 )
Q.---And as long as the book was not balanced however minute may have been your 678 examination the system followed by Alves would screen him until the book was balanced? A. Yes, unless I happened to light upon one of the cases in which he altered the receipt as I eventually did.
Mr. Thurburn.-Is the book for assessed taxes similar to this for Crown Rents? A.-It is not kept in this form.
).
Is it a book that can be balanced?
A.
It is now.
Q-But it was not?
A.--No.
Q.-Therefore the same thing might have happened in connection with that?
A.-It could not now.
Q-But it could during 1890?
A.---Certainly.
Mr. Bird. Mr. Mitchell-Innes signs all the taxes receipts himself? A.-Only lately he has done so.
Q-Previous to that do you know whether it was possible that there could be a deficiency like this one?
A.—Quite possible. I have only given a test audit to this. not more than that. Q-Who signed the receipts for taxes before Mr. Mitchell-Innes?
A.-The officer in charge of the taxes, formerly Mr. Madar and the chief clerk, Mr. Carvalho. It was during Mr. May's time that the Treasurer began to sign receipts. On my visits to the Treasury I asked that the book for the assessed taxes should be altered in order that the balance could be made and the Treasurer said that it could be arranged. They misunderstood me, however, and I had to write in 1892 asking that the book might be altered, and then they started a new form of book.
Q-You brought the matter to the notice of the Government?
A.-To the attention of the Treasurer. I also reported home to my Chief the difficulties I had.
The Chairman.--Supposing that this book (Crown Rent Roll) was written up day by day how long do you think it would take a clerk beginning on the 1st of January to balance it?
A smart man might
A-I should think with the present staff about three weeks. do it in a fortnight.
(Book produced and examined.)
Mr. Bird.--I don't think it matters whether it took one day or three weeks. It ought to have been done.
?
The Chairman.--If the book was kept up from day to day it would not be a very difficult work to do at the end of the
year
A.-It is kept up from day to day.
The Chairman.-We have to find out the causes that rendered the defalcations possible and those that prevented their earlier detection.
Witness.--Want of balancing.
Mc. Thurburu. --Another canse was a want of proper checking in the Office itself.
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