CASE OF MR. MACANDREW.

23

D.— No. 1.

Accounts, the apparent deficiency of the Provincial balance, on the 15th of May, 1860, was £1877 16s. lid. Will you state the apparent deficiency, after deducting from the balance of the Treasurer's cash-book the several issues of money for which the Treasurer had not at the time been credited ? £1215 14s. 7d. How were the deficiencies in the balances made good? By paying the parties named in the Superintendent's warrants in cash. Furnish a statement of the cash payments to which you allude ; to which add any funds given to you by the Provincial Treasurer in cash, without cheques having been drawn on the Bank account. Furnished accordingly, viz., cash payments, £365 19s. 8d; petty cash, £650 ; total, £1015 19s. Bd. By whom were these cash payments made ? By me out of cash given by the Provincial Treasurer. Did you bring this cash to charge in your petty cash account ? No, with the exception of the sum of £650 at the foot of the statement of cash payments. Where then did you show the transactions ? In the Treasurer's cash-book. Did Mr. McGlashan give you no explanation as to what these moneys were ? He gave no explanation. Did you not inquire of the Treasurer as to what account these receipts were to be placed, whether to revenue account or otherwise ? No, because he gave them expressly to make payments. If he had drawn them from the Bank could you not have discovered this on refenrece to the Bank pass-book ? At the time the Bank pass-book was not in my charge, and I seldom saw it. Did you think these moneys were paid to you in order gradually to make up the deficient balances ? I did think they were. Did you keep a memorandum of thorn, or give Mr. McGrlashan a receipt for them ; and can you state the several amounts ? I kept no memorandum of them, nor gave any receipt for them. The cash given me by Mr. McGlashan was in small sums, with the exception of the sum of £650. In your petty cash-book there is a sum of £70 16s. Bd. brought to charge on 30th October, 1860 ; from whom did you receive the money ? From Mr. McGlashan. On the 3rd October, 1860, it appears by the Bank-book that you received £300 ; where will this be found to charge in your petty cash account ? This money was not for petty cash. It was an advance for wages. The previous practice had been to show it in the Bank-book as a payment on account of " Wages, Public Works." Mr. McGlashan states, that on the 24th October, 1860, he had made good the deficiency of the public balance partly out of the petty cash : did you pay over to Mr. McGlashan any portion of the petty cash which he could have used about the date referred to for the purpose stated r I think not. Mr. Jackson, Manager of the Union Bank of Australia, examined. Has the Union Bank discounted for Mr. James Macandrew an accommodation bill of Mr. John McGlashan, which bill was retired by the acceptor, Mr. John McGlashan, and when? An acceptance of John McGlashan to James Macandrew and Co., at four months, £500, was discounted in June, 1859, and renewed at three months' date, discounted in November, 1859, which latter bill was retired in cash —paid in cash on account of acceptor four days after maturity, namely, on 11th February, 1860. I was informed by Mr. Macandrew that these bills were discounted for the accommodation of Mr. McGlashan, pending the disposal of cattle, which Mr. Macandrew stated had been placed in his hands for sale by Mr. McGlashan. Did Mr. Macandrew exhibit to you documents showing that he held stock of Mr. McGlashan as collateral security ? I have no recollection of having seen any document showing that Mr. Macandrew held stock belonging to Mr. McGlashan as collateral security. Has the Union Bank discounted for Mr. James Macandrew a bill apparently for Mr. Glashan's accommodation, but which was retired by Mr. Macandrew, and when ? The acceptance of John McGlashan to James Macandrew and Co., £500, discounted, by me in June, 1559, and renewed in November, 1859, was the only bill transaction I have had with the two names, and this bill was, I believe, retired on account of Mr. McGlashan. Has Mr. John Mc&lashau frequently had accommodation from the Bank ? Mr. John McGlashan has never to my knowledge received any other accommodation from the Bank than the £500 bill transaction with Mr. Maeandrew, already referred to. Has Mr. John McGlashan kept a private account with the Bank within the last two years ? Ho lias never kept any private account with the Bank. When foreign bills are drawn by the National Bank of Scotland are they usually issued in duplicate only ? This Bank being agents for the National Bank of Scotland, the latter generally draw upon us in duplicate by letter of credit. Drafts of the National Bank of Scotland on their London Agents (Messrs. Glyn and Co.) drawn in sola, duplicate and triplicate are occasionally brought out to the Colony for negociation. Mr. Kilgoue, examined. You are one of the Auditors appointed in April last to credit the Provincial Treasurers accounts. Will you state which accounts of the Provincial Treasurer you examined ? We commenced the examination of the account in the month of July, 1860, and examined those for the period commencing Ist October, 1859, and ending 30th June, 1860. We examined also those of the succeeding quarter ending 30th September, 1860, which concluded the financial year. Were you a member of the previous Board of Audit ? Yes. Up to what period of the Treasurer's accounts was the previous audit and examination completed, and the accounts found correct on counting the cash in the Treasurer's chest ? The previous examination of the accounts was for the period ending 30th September, 1859, and was made by Mr. Gillies and myself, in the absence of Mr. Strode. As the balance in the bank was found to be in excess of the Treasurer's balance, it was not an occasion on which to examine the cash-box. Were the Auditors aware, at the time of survey, that the Provincial Treasurer kept in the same chest, but in separate bags, the cash balances of the Provincial account, and those of the Eoad Board