B.—No. 2b,

10

MEMORANDUM ON THE REPORT

The account will stand as follows on 30th June, 1869: — Br. £ s. d. Amount for Surplus Revenue Adjustment Act (as above) ... 25,765 9 10 Interest, &c, on £26,600, at 6 per cent., from 15th July, 1868— 11J months ... ... ... ... ... ... 1,529 10 0 Interest, &c, on £27,500 and £371,000, being amount of first and part of second conversion from 15th April, 1868 —1 year 1\ months, at 6 per cent. ... ... ... ... 27,44.1 5 0 Interest, &c, on £27,500, being part of second conversion from 15th July, 1868—Hi months, at 6 per cent. ... ... 1,581 5 0 Interest, &c, on £10,800, being amount of third conversion, from 15th January, 1869—51 months, at 6 per cent. ... ... 297 0 0 £56,614 9 10 Cr. £ s. d. Net proceeds of £20,600, at 97 per cent. ... 25,802 0 0 Interest charged in account ... ... 25,165 12 3 . 50; 967 12 3 Amount due by Province ... ... ... ... £5,646 17 7 f 26,600 0 0 Amount of Bonds charged to Province ... -j or'ngn 0 0 ( io'soo 0 0 £443,400 0 0 Southland. In stating the account of this Province, the value of the bonds sold to raise the sum required for its debts was taken at £96 4s. 3|d- per cent., that being tho amount realized by the Colony after making allowance for loss in interest. It is now admitted that as tho Province is charged with interest from the date of the bonds (the payment of which interest for periods before the money was received reduces the net proceeds from £97 per cent, to £96 4s. 3-gd.), it is equitable that tho Province should have credit for the full amount that was realized. This has now been done, and tho account further amended by charging interest on the advances from the dates on which they were respectively made, to the 15th of July, 1868, on which day the amount for which the bonds were sold, was fully paid up. The double payment of interest which this involves for a portion of the time was carefully considered by the Treasury, and the opinion of tho Attorney-General taken upon the point. That advice was to the effect that any person or body corporate, for whom an agent raises money, is bound by and liable to all the incidents of the operation; and if those incidents involve that the money has to be raised before it can be applied, the double interest that may thus be incurred must be borne by the borrower. In all other respects, the account as now mado up speaks for itself. The results, as compared with the Audit Office Statement, are that the Province is charged with bonds to the amount of £424,250, instead of £424,050 Os. lOd. as given by the Audit Office; but on the other hand, the Province is credited with a balance of £195 15s. 2d. instead of £101 lis. Id. The present account, therefore, differs very slightly from that furnished by the Audit Office, but, as compared with the interim accounts furnished by the Treasury, it reduces the amount of the principal of the debt chargeable against the Province by tho sum of £4,450. Statement of the transactions in respect of this Province : — Ist. The sum of £5,611 17s. 9d. was paid for Southland under the provisions of "The Surplus Revenue Adjustment Act, 1867," in four equal portions, on the 30th September and 31st December, 1867, and the 31st of March and 30th June, 1868. Considering this as repaid when the full amount of the bonds was realized, viz., 15th July, 1868, the state of this part of the account will be as follows :— £ s. d. Amount paid in four quarterly instalments (as above) ... 5,611 17 9 Interest on £1,402 19s. sd. from 30th September, 1867, to 15th July, 1868—288 days, at 6 per cent. ... ... ... 66 8 5 Interest on £1,402 19s. sd. from 31st December, 1867, to 15th July, 1868—196 days, at 6 per cent. ... ... ... 46 13 1 Interest on £1,402 19s. sd. from 31st March, 1868, to 15th July, 1868—106 days, at 6 per cent. ... ... ... ... 24 8 11 Interest on £1,402 19s. 6d. from 30th June, 1868, to 15th July, 1868—15 days, at 6 per cent. ... ... ... ... 3 9 2 Total amount required on 15th July, 1868 ... £5,752 17 4 The nearest sum to this in bonds (including the moiety of a bond) is £5,950, the net proceeds of which, at 97 per cent., is £5,771 10s. 2nd. To pay tho certified debts of the Province of Southland, with interest thereon, there required to be raised the sum of ...£386,639 18 9 The proportion of cost of raising the loan was ... ... 1,814 7 6 Total amount raised on 15th July, 1868 £388,451 6 3