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The recommendations of the Board with regard to the compilation and keeping of records have been carried out and the suggested review and re-valuation of securities is being made. Other minor matters to which the Board directed attention have been and are being dealt with.
91. The Board investigated in the second place matters in connection with a number of the trust estates in the hands of the Official Trustee and estates in the hands of the Official Administrator.
The investigations of the Board pointed to a misapprehension by the Official Trustee of the onerous duties of his office.
We do not propose in this Report to deal with this matter at any length. It is suffi- cient for the present purpose to say that the Official Trustee had adopted a policy of inactivity which had in certain cases resulted in a failure to take steps to procure the due payment of interest on trust funds, and this had entailed the non-receipt by beneficiaries of that income which they should have received; in other cases there had been a failure to obtain valuations of properties on the security of which trust funds had been lent.
The trust accounts were not being kept in a satisfactory manner, a matter attributable to the absence of any trained accounting staff at the Registry.
Since the submission of the Board's report steps have been taken to get in all out- standing arrears of interest, and the beneficiaries have received the payments due to them. The leasehold securities have been re-valued by the Valuations and Resumptions Officer and, where the margin of security was below that required by law, mortgages have been called in. It is not anticipated that any loss will ensue.
The Accountant appointed to the Supreme Court is taking steps to place the accounts on a proper footing, and the Audit of balance sheets prepared for the period up to the 31st March last was entirely satisfactory.
Part III.
THE SUPERVISION AND CONTROL EXERCISEABLE BY THE TREASURER OVER THE
ACCOUNTS OF DEPARTMENTS OTHER THAN THE TREASURY.
92. The subject matter of this part of our Report assumes considerable importance in view of the defalcations and financial irregularities which have occurred, not only re- cently but also in times past, in departments other than the Treasury; and it has an important bearing on the question of the necessity for strengthening the staff of the Treasury.
93. Colonial Regulations impose on the Treasurer the duty of seeing that the proper system of account is established in every department, and also of exercising strict super- vision over all the officers of his department and sub-accountants entrusted with the receipt or expenditure of public money; and of taking precautions, by the maintenance of efficient checks, against the occurrence of fraud, embezzlement or carelessness in con- nection therewith (Col. Reg. 218 (i) and (v)). He is also required personally or by his deputy, to make surprise inspections of the accounts of his sub-accountants (Col. Reg. No. 219).
94. Mr. Messer, in the course of his evidence, argued strongly that heads of depart- ments who receive and expend public moneys are not sub-accountants within the mean- ing of the Colonial Regulations. He regards as sub-accountants only those who are officers of the Treasury Department, and would say that in this Colony there is only one true sub-accountant-the officer in charge of the Stamp Office. Any others who may be charged with the receipt and expenditure of public moneys he would put under the desig- nations of "Collectors", "Accounting Officers" and "Heads of Departments".
In his opinion the term "sub-accountant" as used in Colonial Regulations refers to a class of detached Treasury Officials, acting directly under the Treasurer as head of their department and capable, inter alia, of giving, within their own districts, a good discharge to Heads of Departments for moneys collected by them, and of accounting for those moneys to the Treasury. Colonial Regulations 269, 270, 292, 319 and 321 were cited by him in support of this contention.
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