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I have repeatedly, both in writing and verbally (see copy memo, dated 22nd November, 1881, attached hereto), directed your attention to the very large sum standing in your books as uncollected rates. If you will turn to the " County Account " in your ledger you will find the following balances carried forward : 1877-78, £116 2s. 3d.; 1878-79, £87 18s.; 1879-80, £94 16s. 6d.; 1880-81, £278 18s. 6d. ; 1881-82, £569 125.: total, £1,147 7s. 3d. You will observe that these amounts are initialled by me, which was done after very careful examination of the collector's returns and the rate-book. I must, however, repeat that without the Council's assistance it is impossible to apply an efficient check on the collection of rates. In other words, I have in these balances supplied the Council with the sum uncollected of each rate : it is for them to demand detailed statements, and to use the proper means for enforcing payment. None of rate 1882-83, I may mention, was collected during the half-year. It must be evident to you from the foregoing, and it is an unpleasant task for me to point it out, that there is something radically defecisive in the method of conducting your business. It is most unsatisfactory that time after time exception should be taken to your accounts. I trust that something will at once be done to obviate such a necessity for the future. I have, &c, H. Livingston, The Chairman, Lake County Council, Queenstown. Provincial District Auditor.

(Memorandum.) Queenstown, 31st July, 1883. I am glad to say that I have been able to certify to the correctness of your half-year's accounts without any reservation. There are, however, one or two questions of routine on which I desire to say a few words. First, in regard to appropriation of moneys by the Council. I have seen that every voucher bears the signature either of your Chairman or of the Engineer. This is not sufficient to show that the Council have authorized payment. What I would recommend is this—and it is the plan in use by all large and well-conducted public bodies : An Accounts Book should be kept, say with the following columns: — No. of Voucher. | Date of Presentation. | Name. | Particulars. | Amount. | Befused or postponed. [ Remarks. In this book should be entered, strictly in order of the date of receipt, every voucher. The book, with the vouchers, should be laid before the Finance Committee, and afterwards before the Council. The Chairman of the Council should enter in the proper column any claim refused or held over. The total of the " Eefused " column taken from the " Amount " column will leave the expenditure authorized by the Council; and I may point out to you that no expenditure is legal unless passed by the whole Council. At the close of the meeting the book should be signed by the Chairman and, say, the Chairman of Finance Committee. The vouchers should, of course, be signed by the Chairman or Engineer as formerly. In regard to sales and receipts from forest reserve, will you be good enough to obtain from the chairman of committee half-yearly a list of all sales made since the first, not in detail, but showing date of sale, purchaser, and amount. I can then check the amounts passing through your books. I find in the accounts an overpayment of £6 10s. on Jones's contract. The error has since the 31st March been rectified. I have therefore merely noted it without making any reservation in the certificate. All such payments should be checked both by the Engineer and Clerk. You will see at page 907 of the ledger a statement of rates uncollected on the 31st March, 1883, amounting to £1,981 10s. 9d. I think it is within the limits of my office (and lam borne out by a reason known to you, but which I need not mention) to urge upon you the necessity of considering the subject of rate-collection. I may point out to you that rate 1882-83, amounting to £1,318 19s. 3d., was dtie on the 4th July, 1882, yet on the 31st March, 1883, there remained uncollected £919 15s. 6d. Even of rate 1881-82 there was at that date £505 17s. uncollected. The Clerk will lay before you detailed lists of arrears. They are not quite correct, but sufficiently so for the Council's use. I have, finally, to say that all the errors pointed out in my report last half-year have been rectified except two. One is an overpayment to Smith of £1. Being a clerical error, the Council may either, by minute, abandon the sum, or debit the Clerk with it. The other is one of the cheques twice drawn (Chard, £12). I have agreed to let this stand over till next half-year at the request of the Clerk, who hopes to be able to show that the transaction is correct; failing which he agrees to pay the money into bank. 11. Livingston, The Treasurer, Lake County Council, Provincial District Auditor.

(Memorandum.) 24th November, 1883. lam unable to sign your balance-sheet owing to a number of vouchers being a-wanting. The Clerk will, however, lay a copy before you. I have to draw your attention to sections of the Counties Act directing that forms of receipt numbered with consecutive numbers shall be furnished to the collector, and accounted for by him. Will you have the kindness to see that this proviso is carried out, and that no receipts are given except on such forms. Your Clerk has promised to pay in the £12 referred to in my last memorandum. H. Livingstok, The Chairman, Lake County Council. Auditor.

Bib, — » Dunedin, 23rd November, 1885. I am unable for want of two vouchers to forward your accounts in time for the meeting on the 25th instant, but, as I furnished you when in Queenstown with an unsigned copy of the balancesheet, I may now place my report in your hands.