LONDON FUNDS

Hokitika Guardian, 18 November 1932, Page 7

LONDON FUNDS

thefts by officers. AUDITOR-GENERAL’S COMMENT. WELLINGTON, November 15. “Had certain instruction® Horn the Audit Department been carried out they would have made it impossible fo officers of the High Commissioner's staff to have concealed any unauthorised withdrawals of money 5 and , H i; practically certain that the defalcations (recently reported from Londor would ,hav e been quickly discovered.’’ This statement is contained in the annual .report on the public account; by the Controller and Auditor-General, .Colonel G. F. C. Campbell,’ which was presented in the House to-day. The report says that apparently the misappropriations were made through the manipulation of the account jn London, known as the finance officers’ imprest account. When the existence of this account became known to the Audit Office in New Zealand in 1928 certain objections, to it were fyrought under th<~ notice of the secretary to the Treasury. Transactions were being passed through the account without being recorded in the officJal foreign imprest account, in which the High Commissioner was required to -recOTf all imprest transactions in London. Further, transactions were beinf passed through the account without being recorded in the statement forwarded to tKe "Treasury in New Zenland. Th o Audit Office suggested that all transactions should he passed through the foreign imprest .aeoount so that the details would have been subject to appropriation audit in Wellington, and that they should also be included in the statement forwarded t< New Zealand. INSTRUCTIONS DISOBEYED. "The -Minister for Finance accepter the Audit Office’s recommendation; and instructed tno High Commi isioner to arrange to act accordingly,’’ continued the report. “It now appears, -however, that the instruction of Ministers were not acted upon bv the finance officer in London, and pre .sumably did not reach the High Commissioner. Had these . instructionbeen carried out they would almost cer tainly have led to the discovery of th’ defaications, as th e vouchers for ah' payments made in London would t-lier have come before the Audit Office R New Zealand for review, and it would have been impossible- for trhe officers iu London to have concealed any uuauthorised withdrawals from the account execpt by the wholesale and continued forgery of documents or the falsification of the statement of hank balances.” advances NOT REPAID, Tlie report goes on to explain that the defalcations were made partly by officer 8 obtaining imprests without accounting for their expenditure, but largely by their obtaining advances against salary .and continuing to draw their full salaries without repaying the advances. It has -been the custom fo r the High Commissioner's Office to grant advances against salaries provided these are repaid a.g salaries are drawn,. The granting of such ad ‘ vances would not bo permitted in New Zealand, continues the report, but ther o has not been the same stringent control in the High Commissioner's Office, and in the opinion of the Audit Office the rule followed in New Zealand should also be applied by the Treasury in the London office. In conclusion, Colonel Campbell" mentions that the defalcations were discovered early in the year by the assistant audit officer in London, who though subordinate to the officers who had committed the irregularities, pressed them" to restore the. money they had withdrawn, and notified them that it would be his duty to report the matter to th© secretary of the Treasury. Presumably, as a result of this action, the finance officer confessed his guilt.