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capitation grant limited by, and dependent upon, the average attendance, renders it impossible for the Board to undertake this additional charge. Training College.—There were twenty-seven students in attendance during the year. Six students were withdrawn, in order to fill appointments, before the completion of their term of training. The number remaining at the end of the year was twenty-one. There are now twelve male and eighteen female students belonging to the College. Special attention is given to their actual practice in teaching. The instruction of teachers outside the College by classes and by correspondence was carried on, as usual, by the principal and his assistants. Mr. McArthur resigned the office of principal after a service of six years, and the Board appointed the Rev. E. H. Gulliver, M.A., to succeed him. District High Schools. —The district high school at Hamilton was closed at the end of June, owing to the want of local support. The school at Cambridge has a roll of only fourteen pupils. Scholarships.—The yearly examination of candidates for junior and senior scholarships was held in August. The first place in each class was gained by a girl. Forty-six scholarships were held during the year. Twenty-five of the holders attended the Auckland College and Grammar School, seventeen attended the Auckland Girls' High School, and four attended the Thames High School. The Board received satisfactory reports of their conduct and progress in study. School Libraries. —The circular issued by the Minister in March, 1886, has done much to encourage the formation of school libraries. Grants in aid of this object are voted by the Board, to an amount not exceeding £10, in proportion to the funds locally raised for the purpose. Such grants are made in books selected by the Committee and approved by the Board. School Committees.—The School Fund accounts for 1886 have been received and audited. The total income from all sources was £6,181 9s. 4d., and the expenditure was £4,780 6s. 4d.; leaving a balance of £1,401 3s. unexpended at the end of the year. Samuel Luke, Chairman.

General Statement of Receipts and Expenditure for the Year ending 31st December, 1886. Receipts. £ s. d. Expenditure. £ s. d. To Balance at beginning of year— : By Balance at beginning of year on BuildOn Blaygrounds Account .. .. 1,500 0 0 ings Account .. .. .. 2,010 4 9 On Flaveil's Deposit Account .. 52 10 0 Office staff, salaries.. .. .. 1,180 13 8 On General Account .. .. 3,329 12 3 Clerical assistance (Survey Department) 39 5 0 Government grant for buildings .. 11,150 14 0 Departmental contingencies.. .. 1,198 18 2 Subscriptions and donations for build- Inspectors' salaries.. .. .. 1,400 0 0 ings .. .. .. .. 118 0 0 Inspectors' travelling expenses .. 501 0 0 Other receipts for buildings— Examination of pupil-teachers .. 26 11 5 Forfeited deposits .. .. 40 0 0 Teachers' salaries and allowances (inSale of old buildings .. .. 9 9 9 eluding rent, bonus, &o.) .. 55,618 19 5 Government statutory capitation (£3 Incidental expenses of schools .. 4,581 8 4 155.) .. .. .. .. 60,405 16 0 Training of teachers .. .. 1,868 14 4 Special capitation (55.) .. .. 4,098 15 10 Scholarships— Scholarship grant (Is. 6d) .. .. 1,086 15 0 Faid to scholars .. .. .. 1,141 0 0 Inspection subsidy .. .. .. 500 0 0 Examination expenses .. .. 79 0 0 Grant for training of teachers .. 2,000 0 0 School buildings— Payments by School Commissioners — New buildings .. .. • .. 4,278 5 2 For primary education .. .. 1,022 8 2 Improvement of buildings.. .. 4,655 18 9 For secondary education .. .. 75 0 0 Furniture and appliances.. .. 1,186 411 District high school fees .. .. 176 8 0 Sites .. .. .. .. 14 7 0 Rents of buildings .. .. .. 78 15 3 Playgrounds .. .. .. 450 0 0 Rent of school site .. .. .. 10 0 Plans, supervision, and fees .. 687 2 3 Interest on deposits .. .. 88 15 0 Bank interest .. .. .. 119 0 0 Contributions for painting schools .. 42 3 0 Credit balance at end of year— Interest on Flavell's deposit .. .. 213 0 Playgrounds Account .. .. 1,050 0 0 Balance at end of year, Buildings Ac- Maintenance Account .. .. 5,150 18 2 count.. .. .. .. 1,513 14 1 Flavell's Deposit Account .. 55 3 0 £87,292 9 _4 £87,292 9 4 Samuel Luke, Chairman. Vincent E. Rice, Secretary. I hereby certify that I have examined the books and vouchers of the Education Board of the District of Auckland, and that with the exception of £31 165., portion of "legal expenses " disallowed for reason given in report on 1885 accounts, I find them to be correct. —L. A. Durrieu, Auditor. 17th February, 1887.

Report of Principal of Training College. Sir,— Melbourne, Ist March, 1887. I have the honour to forward the annual report of the Auckland Training College for the year ending the 31st December, 1886. It is with feelings of regret that I pen this my sixth and last report as Principal of the College. In the month of July last year, with a view to carry out my intention to join the legal profession, for which I had qualified long ago, I sent in my resignation to the Board of Education. I had intended to write this report before leaving Auckland, but by reason of illness was unable to do so. You have already been furnished with a brief history of the College, its difficulties, and progress from its beginning in January, 1881, to the end of 1886, during which time it was under my management. It was there pointed out that, although its beginnings were small and its difficulties not a few, yet it had in a short time attained a position equal to that of like institutions in the