CO129-489 - Governor Sir Stubbs & Sir Clementi - 1925 [8-12] — Page 199

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exchange ruling from the 15th of November to the 15th December. From the above figures of yearly exchange it is obvious that the same amount in sterling would be represented in the accounts for the various years by widely differing sums of dollars, sometimes decreasing

and sometimes increasing. The difference between these

dollar equivalents of sterling sums obviously cannot be regarded as revenue or expenditure of the Colony and in

closing the accounts for the year the figure required to balance the account does not represent Colonial Revenue

or Expenditure, but rather an adjustment of the dollar

value of a sterling sum. The Colonial Regulations are

silent on the question of such difficulties due to

fluctuations of exchange, and there would be no necessity for such adjustment if the rate of exchange between silver

and gold remained constant.

4. This question is a very important one to this

Colony owing to the method under which the Colony's

Military Contribution is assessed:- Namely 20% on the

Revenue, with certain deductions.

5. In the case of the sale of condemned stores,

the principle that the same money shall not pay Military

Contribution twice over has been admitted, and now the

proceeds of such sales are carried to a head of Revenue exempted from payment of Military Contribution. Unless

the same principle is allowed in the case of the Colony's sterling assets in England, Military Contribution would

frequently be paid more than once on the same assets

Taking a very simple case $10,000 revenue receipts produces, when military contribution has been deducted

$8,000 net revenue for expenditure purposes. This sent

home at exchange 2/-, means a sterling sum of £800. If

exchange