Page 14.
65. In the accounts for March, 1947, the Accountant General transferred expenditure, which had been charged in the Accounts for 1946/47 against the approved departmental Heads and Subheads of Special Expenditure in the Estimates for 1946/47, amounting to a total of $30,360,746.70 to the ivance Account "Advances panding raising Loan", and the amount transferred is so classified in the Statement of Assets & Liabilities at the 31st of March, 1947. (Appendix 1 to the Accountant General's Financial Report for 1946/47).
66. The transfers of expenditure were apparently made under the authority of the Governor's Warrant referred to in paragraph 62 of this report, as amended by Secretariat Circular No.70 dated 9th Decaber, 1947, referred to in paragraph 63 above.
It is not, however, possible to ascertain whether or not the Loan Expenditure incurred exceeded the authorised provision in respect of the financial period. 1946/47 in view of paragraph 63 of this report.
.
67. It appears, however, that the authority under which the Governor signed the Warrant authorising expenditure to be incurred and charged to an advance account pending the raising of a loan (See paragraph 62 above), was incomplete, since the Ordinance authorising the raising of a loan had not been passed by the Legislature at the date the Warrant was signed. It also appears that the Legislature had not approved for the Special expenditure authorised in the Estimates for 1946/47, and already incurred as a charge against the revenue of the Colony up to the 31st March, 1947, to be transferred as a charge against Loan Funds or, pending the raising of the Loan, for the amounts set out in the Schedule attached to the Governor's Warrant to be not temporarily fran surplus funds and charged to Advances in the Accounts for 1946/47.
68. The matter was brought to the notice of the Colonial Secretary by this Department and, in a resolution dated the 28th July, 1948, the Legislative Council approved a schedule of expenditure amounting to $30,360,747 during the financial period 1946/47 to be not from Loan funds and to be charged as an advance from the surplus funds of the Colony. The covering approval of the Secretary of State has been sought in the Governor's despatch No. 195 of 10th August, 1948, for the schedule of the Loan Expenditure approved by the Legislative Council.
69.
THE ANNUAL ABSTRACT ACCOUNT.
The Annual Abstract Account for the period under review opens with a balance of $7,262.14 representing an amount of £453.17.8 (@ 1s. 3d. to the ) being the balance of cash in the hands of the Crown Agents at the 30th of April, 1946, as shown in the Hong Kong London Accounts Office Balance Sheet at that date (Appendix 5 to the Accountant General's Financial Report for 1946/47 refers). As indicated in paragraph 4 of this report, this balance was brought to account in the Accountant General's accounts in the Abstract of Payments for the month of May, 1946, as a payment and not as an opening balance. In the Statement of the Abstract Account this payment is included in the figure of $28,564,708.73 classified under "Deposits". It follows, therefore, that this amount has been included twice in the annual Abstract Account both as an opening balance and as a payment.
70. The matter was brought to the notice of the Acting Accountant General who agreed that the Annual Abstract Account does not accord with the books of account and that the amount of $7,262.14 had been (incorrectly) shown as the opening balance in the Annual Abstract Account in order to adjust the amount of $7,262.14 in respect of the Crown agents Cash Account, correctly included as a payment, but
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