D.—No. 1

26

PAPERS RELATIVE TO THE

of Exchange for £1000. Tou are requested to state when the original letter and the Bill of Exchange was forwarded to the Provincial agents, and whether the receipt of them has been acknowledged ? The original letter and Bill of Exchange were forwarded from Wellington in July last, so as to have gone home by the August mail. There is no acknowledgment yet from the agents, and I am strongly inclined to fear that the letter must have miscarried. I have written home, however, to secure the bill from passing into other hands, and have little fear of the ultimate safety of the money. 5. Please to state when you sent the second of exchange, and of whom the bill was purchased, and produce the third of the set for my information? The bills in question were purchased from James Thompson, Esq., of Melbourne, drawn by the National Bank of Scotland on Glyn and Co., 30 days' sight, which drafts are only issued in duplicate; the second was posted in November last. 6. Mr. McGlashan states that when he had drawn a cheque for the sum of £500, in January, 1860, for the purpose of lending you that amount, you asked him either to go himself or send Mr. Cheyne to the Bank for the money. Do you admit the correctness of the statement ? I deny the correctness of the statement. 7. Do you know whether Mr. McGlashan ever kept a private account at the Bank ? I believe he never did.

Observations made by the Superintendent on Mr. lfcGlas7ian's Examination. On Query No. 20.—1s it likely that if Mr. McG-lashan had the Road and Education balances actually in the chest he would not have made use of them to balance his Provincial Treasury account at the Bank rather than expose the deficiency ? On Query No. 22.—The cheques in question were never intended for presentation at the Bank, but simply as vouchers, and I (Mr. Macandrew) was unaware that any presentation had taken place. On Query No. 25. —Does Mr. Cheyne admit having copied the cheques from the original ? What object could there have been in copying a cheque while the original was in Mr. McGlashan's possession ? *#* Vide Mr. Ckeyne's examination. —C. K. On Query No. 33.—The deficiency on the 30th September is said to have been made up by payments received from Mr. Macandrew, by part of the Road money, and by petty cash. How could the latter be used to make up a deficiency of which itself must have formed a part, and what became of the £1000 borrowed from Jones, or what deficiency does this represent ? On Query No. . —As respects Mr. Reynolds' answer, I simply deny the correctness of the whole of his statement. His denial of all knowledge of the facts to which Mr. Morris and Mr. Jackson depose, as well as many others of which I was cognizant as a partner in the firm at the time, together with the bitter personal animus towards me, of which he has given abundant evidence, would tend to show that little reliance can be placed on his statements. On my Memorandum attached to the Auditors' Report (vide Council Papers) : — My statement as to the deficiency at 30th June, arising from payments at Invercargill, were made on the authority of the Treasurer himself, as told to me on asking him for an explanation as to a number of apparent deficiencies at various periods, as pointed out to me by Mr. Morris, one of the Auditors, by a memorandum exhibited by him. My statement to Mr. Kilgour, that the £400 due by me was part of the Road Board balance, was also made from the authority of the Treasurer. The probability is, that had I paid the money when I ought to have done so, the Road Board balance would never have been touched, on my account at least. 8. The Provincial Treasurer's letter of the 20th September, 1860, contains the unqualified charge that you held the deficient public balance of £1073 los. 4d. in your hands: will you explain why (when the Provincial Treasurer thus publicly accused you) you did not at once suspend him from office, and bring his conduct under the consideration of the Executive ? The letter referred to, which contains the positive assertion that £1073 15s. 4d. was in my hands, was written by Mr. McG-lashan in a fit of indignation on his first perusing the Auditors' Report. Knowing, as I did, the peculiar temperament of the man, and the real circumstances of the case, I put the letter in my pocket for a couple of days, until the writer should have time to cool down to his right reason. I then took the letter to Mr. McGlashan ; and pointing out the paragraph in question, asked him if he intended that to be his official answer to a letter which I shall then address to him to the effect that he would explain the various topics alluded to in the Auditors' Report (at this time I had not asked for Mr. McGrlashan's explanation), having handed him the Auditors' Report upon the street, without note or comment, for his perusal. Mr. McGlashan shook his head, and said it was not intended as his. official answer, and that it had better be withdrawn. He remarked also that he had not been called upon to give an official explanation, and that when so called on, his explanation of that part of the Report would be " the payment at the South." The letter was accordingly withdrawn, and the first I saw or heard of it was a copy given in by Mr. McG-lashan in his answer befpre the Select Committee. Had Mr. McGlashan publicly made any such statement, or even held to it privately, I most certainly would have suspended him, and reported to the Executive. 9. In reference to your observation on Question No. 20 of Mr. McGrlashan's examination, you are requested to state why (when you had been the means for years past, as you have stated, of maintaining the Provincial Treasurer in his office by making up his deficiency) did you not protect the Public Chest by issuing instructions for the whole of the public moneys in his charge being verified quarterly by a Board of Survey, —seeing, as you remark, that he would be likely to use the Road money and Education balance rather than allow his deficiencies to be exposed? On several occasions when I assisted Mr. McGlashan, I was unable to find the whole sum required from my own funds, and applied to Mr. Edward McGrlashan (the two brothers not being on speaking terms at the time) to assist me to make up the difference, which he did, the amount being afterwards refunded by Mr. John McGlashan, through me. Mr. E. McGlashan, as surety to the Government for his brother, was very much concerned about the state of matters revealed by me. The consequence was that the two brothers got reconciled ; the result, as I understand, being that (Mr. E. McGlashan having