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APPENDIX A. The Hon. the Colonial Treasurer. The Commissioners of Audit feel it their duty respectfully to call the attention of the Hon. the Colonial Treasurer to the serious consequences arising from the present use being made of the balances of the Land Fund, to which reference was made by the Commissioners in their memorandum of the Ist instant. The balances belonging to Otago and Canterbury on the 31st December were together £376,741 lis. Id.; and, supposing the account is kept open in the manner adopted by the Treasury, those balances, as shown in the Treasury statement, amount to £393,300 Is. lid. The cash balance in the Consolidated Fund at the present moment is £374,993 ss. The whole of which is made up of moneys which have been specially appropriated by Parliament to other purposes, and are not lawfully available for the ordinary services of the Consolidated Fund. Had the Land Fund been left as a separate fund, the Commissioners of Audit would have been unable to continue to issue against the Consolidated Fund until it was supplied by deficiency bills, or other lawful means, with funds to meet its requirements. But the Land Fund being now a part of the Consolidated Fund, the Commissioners must consider all the moneys in it as equally available for Consolidated Fund services. At the same time they feel that they would be neglecting their duty were they not to point out that the present ability of the Consolidated Fund to meet its engagements is only acquired by diverting large sums of public money from the uses to which they were expressly appropriated by Parliament, aud that not by ordinary appropriation but by positive enactment: that the moneys in question should be paid over in the manner directed before a specified day. (See section 16, " Financial Arrangements Act, 1877.") James Edward Fitz Gerald, 3rd May, 1878. Commissioner of Audit.

APPENDIX B. This account cannot be audited. It is, in my opinion, an unnecessary account, not warranted by law. There was no authority for keeping this account at all after the 31st December, and the transactions included in it ought, with the balances, to have been carried into the Consolidated Fund on the Ist January. That was the clear intention of the Act of 1877. This account is not made up on figures which have been passed by the Audit Office in requisitions, and therefore can only be audited by comparing it with the original vouchers. It shows a balance of £335,000 in a Land Fund account on the 31st March in direct violation of the law, which required all balances to have been paid over before that period to the bodies to which it belonged. James Edward Fitz Gerald, Ist May, 1878. Commissioner of Audit.

APPENDIX 0. The Hon. J. Ballance, Colonial Treasurer. Referring to your inquiries this forenoon re estimate of completing arrears of Canterbury surveys, I forward copies of correspondence between Chief Surveyor and myself on subject, from which it will be seen that on Ist of January of present year there were awaiting for survey— 722,413 acres, estimated to cost 2s. per acre ... ... ... £72,241 Revision surveys ... ... ... ... ... ... 55,000 Total sum recommended to be set aside for arrear and") j?-107 04,1 revision surveys ... ... ... ... j ' You will note from correspondence that I suggested 2s. per acre for the arrear surveys. This was made with the knowledge that the field work alone in Canterbury had cost Is. 10 Jd. per acre for the six months ended 31st December, 1876, and 2s. 6£d- per acre for six months ending 30th June, 1877; or over an average of 2s. per acre for field work, without any allowance for mapping or office establishment, which may be stated at from 4d. to 6d. per acre. The cost of the field work for the year ended 30th June, 1878, is for s. d. Canterbury ... ... ... ... ... ... 0 llf per acre. Triangulation, l^od., say ... ... ... ... ... 0 2 „ Inspection, mapping, preparation of Crown grants, and generally, office expenses ... ... ... ... ... ... 0 6 „ Cost of survey ... ... ... ... ... 1 7| „ I have not included anything for cost of Land Office. It will not be safe for the Government to count on the arrear surveys costing less than 3s. per acre, as it is quite possible, from scarcity of surveyors, or other causes, the cost of field work may vary. The revision survey will be very costly. On Banks Peninsula the cost per acre of one surveyor's return was actually 9s. 4d. The Government cannot shirk this work ;it must be done. The department avoids revision as much as possible, as it only brings us discredit from its great cost. J. McKerrow, Bth August, 1878. Assistant Surveyor-General.

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