CO129-574-11 Alteration in dates of the financial year 21-9-1938 - 28-3-1939 — Page 8

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No. 136.

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13 MAR 1939

Sir,

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GOVERNMENT HOUSE,

HONG KONG,

28th February, 1939.

I have the honour to inform you that consideration

has recently been given to the possible desirability of a

change in the financial year of the Colony, primarily from

the point of view of the convenience of the officers

concerned in the preparation of estimates and annual accounts.

The financial year at present coincides with the calendar

year. In order that the estimates may be presented to the

Legislative Council in time to allow full opportunity for

debate, but still to permit of their being transmitted to

you early enough to allow your decision on them being

conveyed before the 1st January, it is necessary that the

budget should be introduced not later than the middle of

October, and the printed estimates are circulated some ten

to fourteen days before that. This means that the main part.

of the work of preparation is undertaken between about the

middle of July and the middle of September. This is not

only the hottest part of the year when extra work is least

acceptable, but is also the period when staff is at a

minimum owing to the natural desire of officers due for

either long or casual leave to take it in the summer.

2.

The postponement of the preparation of the

estimates until the autumn would considerably relieve the

THE RIGHT HONOURABLE

MALCOLM MACDONALD, M.P.,

&C.,

&C., &C.

Treas.

Copyło CA

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pressure on the responsible officers, since by that

time staff is much more nearly at full strength. A

further consideration, which is frequently of importance,

is that decisions on questions of policy arising in

connection with the estimates may well be hampered by

the absence on leave during the summer of senior Heads

of Departments or of the Governor himself; whereas in

the late autumn Heads of Departments who have gone on

leave in that year will normally have returned and be

available for consultation at any rate in the final

stages of preparation of the budget.

3.

It is also the view of the Accountant-General

that it is particularly inconvenient to close the

accounts at the end of December, owing to the incidence

of Christmas and New Year holidays. As an illustration,

it is necessary to set some time limit after which bills

Where the for payment within the financial year will not be Polenta cepted, and this date is inevitably thrown somewhat

earlier by the intervention of the Christmas holidays,

with the result that an unduly large number of accounts

have to wait over until the new financial year.

Im have

4.

I have, therefore, had under consideration a possible change of the financial year to a year ending

on the 31st March. This was recommended for other

reasons by the Retrenchment Commission in 1931. Apart from the interim period, with the difficulty which would be involved in making comparisons with past years' accounts, the practical advantage seems to lie in making the change. The principal objection to my mind is that

financial statistics would be more difficult to compare with other statistics, including trade statistics, which will no doubt continue to be prepared for the calendar year. On the other hand this difficulty does not seem to be felt very seriously in the United Kingdom itself,

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