8.—22.

interest, and the only evidence of each payment is the paying officer's own entry on the debenture which is given back to the holder, the Controller and Auditor-General would repeat the remark made in his memorandum to the Minister of the sth February last —namely, that the form is not considered by the Audit Office to be satisfactory. The question must arise whether the interest-payments could be passed. There would not be the vouchers which are required by sections 52 and 54 of the Public Revenues Act, and without which credit could not be given for the payments. J. K. Warburton, C. & A.-General.

No. 4. The Treasury, New Zealand, Wellington, 23rd May, 1904. Memorandum for the Controller and Auditor-General. I regret your letter of the sth February has been overlooked. In reply to that communication and to your further letter of the 20th instant, I am to inform you that vouchers per form attached will be supplied by the Postmasters and bank officials, who make the payments of interest, and that such form of voucher has been accepted by the Audit Office for some years past without demur, in respect of the payment of interest on New Zealand Consols certificates which do not carry coupons. In the case of the payment of coupons the holder of such coupons is not asked to give a receipt upon payment of their value, and it is therefore not deemed advisable to require a receipt from the investor in the case of payment of interest not represented by coupons but by indorsement on the debenture itself. I hope this explanation will be deemed satisfactory. Jas. B. Heywood, Secretary.

No. 5. New Zealand Debentures. Under " The Aid to Public Works and Land Settlement Act, 1903." Interest Certificate. To the Paymaster-General, Treasury, Wellington. I hereby certify that the understated amounts have this day been paid by me, in respect of interest due upon New Zealand debentures presented at this office, and that I have duly indorsed upon the said debentures the several amounts so paid, as under : —

No. 6. The Hon. the Colonial Treasurer. Audit Office, 25th May, 1904. It is submitted that the form in which the Treasury proposes that Postmasters and bank officials shall enter and report their payments of the interest on the debentures is not a form of voucher required by the Public Revenues Act. It is the form of a statement which is not, it is understood, to be supported by anything from the debenture-holder that could be accepted as a receipt. The Audit Office, though it may not have expressed to the Treasury any objection to the want of vouchers for the payments that are made of interest on the few Consols certificates issued without coupons, has long regarded such want as unsatisfactory ; and when the Minister referred to the Audit Office his proposal to issue, for moneys raised under the Aid to Public Works and Land Settlement Act, debentures without coupons, occasion arose and was taken to point out that the officers authorised to pay the interest on the debentures should take, as vouchers for their payments, receipts from the debenture-holders, and that, as it might be impracticable for the Treasury to issue to the paying officers, for payment of the interest, warrants on which receipts could be taken, coupons would be better. A coupon being a part of the paper of the relative debenture, is better evidence of payment to the deben-ture-holder than the receipt on the warrant would be, and consequently the better voucher. As it does not appear that the Audit Office would be justified in passing, without the vouchers prescribed by the Public Revenues Act, any credits for the payments of the interest, the Controller and Auditor-General would now respectfully suggest that the debentures issued without coupons should be cancelled, and debentures with coupons substituted. J. K. Warburton, C. & A.-General.

No. 7. The Treasury, New Zealand, Wellington, 30th May, 1904. Memorandum for the Audit Office.- '■■ • < I regret there has been a misunderstanding over the matter of the issue of a series of debentures without coupons under " The Aid to Public Works and Settlements Act, 1903." I did not read your memorandum of sth February last to mean that you would refuse to allow credit to be given when the

2

No. of Debenture. Face Value of Debentures. Due Date of Half-year's Interest -r, ,. , r> • <. ■ m Interest. Paid. Foll ° of Re S lsfcer ln Treasury. Total interest paid £ £ b. a. [Office date-stamp.] , Postmaster.