1946-1947 — Page 3

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drop grates or rocking bars when conversion to coal from oil fuel was carried out at Woolwich-with the result that re- conversion to oil burning has had to be resorted to. No machine tools were supplied and the supply situation was becoming so serious that a visit by the General Manager and the Mechanical Engineer to

to the United Kingdom sanctioned. They left the Colony on 28th. July 1946, and returned on 11th. September 1946. Orders totalling H.K. $21,678,240 were placed for rolling stock and plant, and at the close of the year small quantities of stores were commencing to arrive.

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While no rolling stock was available for the Colony, large quantities of UNRRA wagon material in a knocked-down condition commenced to arrive in the Port during Jan. 1946, and altogether 1261 wagons of various types were assembled by contract under the supervision of the British Section's Mechanical Staff. The assembly enabled CNRRA food, supplies and vitally needed rail materials to be moved up into the interior. Rails and sleepers loaded at Kowloon in these wagons materially assisted the completion of the Canton- Hankow Line between Canton and Wuchang on 1st. July 1946, the date stipulated by Generalissimo Chiang Kai Shek for its restoration.

6. The question of the accounts for the period of the Report has placed the Department in a dilemma. To submit a Report without a statement of accounts is to make the report practically valueless, yet for reasons entirely beyond its control the operating

operating expenditure figure can only be approximate owing to non-inclusion of certain debits. The outstanding items are not numerous and are unlikely to affect materially the results as shown. After discussion with officials of the Hong Kong Treasury to which this Department's accounts are tied, it was decided to present an operating and capital account at the same time drawing attention to the fact that the expenditure figure given in the former cannot at this stage be reconciled with the Treasury. The principle is one which has been adopted by private firms in the Colony to form a working basis, and is considered to be the only method by which this Public Utility could present the Hong Kong taxpayer with a current picture of its working results. Subject to the foregoing remarks regarding the incomplete figure as to working outlay the accounts show that there was a balance of receipts over expenditure amounting to $2,205,311.30 or 99.05%.

7. Since the re-occupation of the Colony, Joint Traffic Working between the two Sections of the Line has been carried on by adhering as closely as possible, so far as changed circumstances would permit, to the basis of the former Working Agreement. Towards the close of the year, the