29

B.—lo

Sir,— Dunedin, 3rd August, 1886. I have to acknowledge receipt of your letter of the Bth ultimo, requesting " more explicit detail" as to the exception taken in my report to a portion of the expenditure for travelling expenses of members. Your letter also quotes a resolution of the Council on the subject of travellingexpenses, and asks if " the Council are to understand that they have no discretionary power whatever in defining members' expenses." It is not the part of an Auditor to lay down the law; but I may say that the Act of 1877—by using the words " reasonable sums " —gives to the Council a discretionary power as to the amount of travelling-expenses to be allowed; and the limitation of this amount belongs rather to the ratepayers (i.e., electors) than to the Auditor. The latter, I think, would be justified in interfering only in an extreme case. But in your expenditure for the period cpverod by my report there is a sum paid as travelling-expenses to a member who did not " come from a distance to attend meetings of the Council"—whoso residence, in fact, is within two or three hundred yards of the Council Chambers. I have no hesitation in saying that the Council had no power whatever in that case to pay travelling-expenses. Speaking generally, the Council have no powers except those conferred on them by the statute under which they are constituted, and no " resolution " can supplement or override these powers. I have, &c, H. Livingston, The Chairman, Lake County Council, Queenstown. Provincial District Auditor.

APPENDIX B.

EVIDENCE GIVEN BY PERSONS EXAMINED. No. I.—Mr. Boult examined, 17th December, 1886. I usually made out two pay-in slips. I burnt some when I left office. I usually destroyed them after half-yearly audit. Butts of rate-books—some were burned by mo, some put with other waste paper to light fires. As to security : 1 did not find any. I was never called upon, after my first appointment, to do so. Collectors'sheets wore established during O'Meara's tenure of office. O'Meara paid his collections to me. I suppose old collectors' sheet books were burned. Old papers were destroyed without other authority than my own. Gilmour for some time paid his collections to me; but, in consequence, I think, of objections raised by County Auditor, he afterwards paid to bank direct. I collected no rates outside office except such as were handed to me. Mr. McDougall sometimes received rates from, persons in his district. Other members of Council followed the same practice. Moneys so received were paid either to myself or Gilmour. Mr. Daniel did the same. He never handed me any large sum. In my view the functions of the Treasurer were confined to the supervision of the accounts of the county. I considered myself bound to obey any direction of the Treasurer as to the management and keeping of the county accounts. Statements (halfyearly) of the uncollected rates for 1881-82, 1882-83, 1883-84 : These statements, I think, were not commenced till March, 1883. I presume these statements are in the office. Ido not remember destroying them. As to missing vouchers : I can give no reasons for their disappearance. I may have burned them undesignedly. I admit want of care in this matter. Vouchers for payment were entered in accounts book and submitted to Finance Committee, by chairman of which they were initialled and then laid before Council. When passed for payment by Council, the Chairman initialled the book. I drew out cheques, which were signed by the Chairman and the Treasurer, and signed at top of cheque by myself. Bank was advised by the Chairman or Treasurer as to the persons authorized to operate on the County Fund Account. As to salary drawn in anticipation: The Treasurer was cognizant of the proceeding. I believe the Auditor's reports are all in the office. Licenses were signed by the Treasurer as a rule, but in some instances by myself. The rate-book of 1880-81, 1881-82, 1882-83, 1883-84, was burned by me at the County offices. I had no authority to do so. I believe it was burned in or after April, 1886. I had no special motive in destroying it. I burned it with other papers which were " lumbering " the office. I did not consult with Mr. Black. I resigned by letter of [date unknown], as on one month from date. My resignation was accepted on the 2nd February, 1886, "as from this date." The book was burned in the Clerk's room (front) before Mr. Black's arrival in Queenstown. At the meeting of Ist March, 1886, fourteen days' leave was granted (of which I availed myself). Mr. Boyes (Chairman) was to make arrangements for performance of the work of my office during my absence. Mr. Boyes was granted £1 Is. per day* for performing the duties of Clerk during my leave of absence. The first inquiry as to the missing rate-book was made by the County Auditor, who reported its absence to the Council. The interpolation in the minutes of the 6th July, 1885, as to rates of 1884-85, and 1881 to 1884, was not written in when the other part of the sentence was written, but was written at the time of entering the latter part of the minute. When the offices of Chairman and Treasurer were combined in one person (as in Mr. Daniel's case) cheques were signed twice by Mr. Daniel and once by some other member of the Council. I did not consider it necessary—though admitting the Treasurer's authority in connection with office-books and papers—to consult the Treasurer before destroying books and papers. As to the £2 paid by Mr. Turton on the 29th February, 1884, being rates recovered from Craig : I cannot point out the amount in the cash-book; I can supply no explanation. The cash-book, from Ist October, 1879, to 31st March, 1886, and the ledger, are the account-books of the Lake County Council. They contain, or ought to contain, entries of all receipts and payments, and of all lodgments made to the County Fund Account. Tliey are all in my handwriting. 17th December, 1886. ' P. B. Boult.

* Mr. Boyes declined to receive this payment.