9

I.—la

of the position. The report up to the time when Mr. Cohen withdrew is fully reported in the Evening Star of the 18th November. Mr. Crowther : Was it on the vote of the shareholders that Mr. Cohen was excluded ? Mr. Bevan: Yes, it was on the vote of the shareholders. I read them these papers which I hold in my hand. I pointed out to them how dangerous was the pursuit we were following. Points or order were raised—legal technicalities introduced. In fact, it was a matter of impossibility to make a clear statement—l had too many legal gentlemen about me. Mr. Crowther : Who was in the chair ? Mr. Bevan : Mr. Charles Beeves. Mr. Gallan : One of the company's auditors. Mr. Bevan : I failed to get a satisfactory answer from the directors. I put a number of questions to the meeting, but the first only was answered in the affirmative. The question was, "You state in your circular of the sth November instant that you court inquiry: are you prepared to afford information on the affairs of the association for the benefit of the shareholders at this meeting, especially now that so much interest is aroused in connection with the management by the directors?" I had a number of other questions to put, but I found it was no use. I submitted those questions at a subsequent meeting. At the same meeting I directed particular attention to the shareholders of the Australian Mercantile Insurance Company, whose business had been acquired, and I pointed out that they embraced nearly every leading businessman in Melbourne—members of Parliament, distinguished members of the legal profession, and others—and I marvelled greatly that such a company should have to be taken over by a weak company like the Equitable Insurance Association of New Zealand. I went carefully through the whole of these papers with the shareholders, and from that meeting gathered the fact that other companies had also been acquired of which not a single mention had been made in any balance-sheet or in any report; and I wish further to draw attention to the fact that the balance-sheet of the life department never appeared after 1887 up to the present time, though we were supposed to have some thousands of pounds in trust. I wish to put this in too. . Al.though it appears in the life department some thousands of pounds to the credit of reserve funds, besides £5,000 deposited with the Government for that branch, it is never shown in the balance-sheet or report whether there was any money received or paid for these properties, nor was it ever referred to. With regard to clause 11, I will take it as read; also clause 12. I now direct your attention to the balance-sheet of 1885. It will there be seen that the credit balance at the foot of profit and loss account is £6,289 19s. 3d. We turn to 1886, and we find the credit balance brought forth from 1885 on the credit side of profit and loss to be £1,741 18s. 4d. There is another discrepancy in the balancesheet of 1884. It shows on the credit side £6,048 9s. Bd., which is brought forward by balance £2,948 os. Bd., less dividend paid £1,167 12s. lid.; leaving a balance of £1,780 7s. 9d. I wish to show the irregular manner in which the accounts are kept, and what a jugglery of figures was committed, misleading to those who w rere not conversant with finance. In the assets we have an item—fixed deposits and investments, £10,800. In the previous balance-sheets fixed deposits had been kept separate. I wish to say that in 1885, under the heading of assets, these fixed deposits and investments had gone up to £16,225 7s. 6d. In the 1886 balance-sheet assets, fixed deposits and property were £19,623 18s. Id. In 1887 fixed deposits, investments, and property came to £21,182 12s. 7d.; calls not due and unpaid, £8,440 18s. 6d. Now we come to the first debit balance of £5,339 10s. 7d., and we owe at that period to secured creditors £11,530 Is. 7d. On the debit side of profit and loss, bad debts are written off to the amount of £166 14s. 4d. Coming to the 1888 balance-sheet, unpaid calls represent here £6,986 19s. 6d. ; calls not due, £10,946 145.; and now comes a large item —outstanding accounts due to company, £10,064 ss. 6d. Fixed deposits, investments, and property reduced to £12,016 Bs. sd. ; cash in hand, £99 18s. 2d. Mr. Crowther : Is that the first record you have got of that £10,000 ? Mr. Bevan : Yes. Bad debts in profit and loss account of some years are again provided for, but it is not shown what they are; they are included in office furniture, preliminary expenses, stationery, and bad debts written off, £3,567 4s. 7c1., leaving the natural assumption that the outstanding accounts, £10,064 ss. 6d., were a valuable asset. Now we come to the balance-sheet of 1889. Calls not due are shown under the heading of assets, and amount to £14,595 125.; unpaid calls, £9,036 2s. 7d. Now for the first time we see property by itself. Property, ,£6,200; outstanding accounts due to company, £16,675 3s. lid. ; cash in bank and in hand, £20 Bs. 7d.; office furniture, stationery, and preliminary expenses, £1,075 9s. 7d. This is the first year that ever we got a little detail, at the urgent solicitation of shareholders, after Mr. Callan had visited the Coast. That is what we are supposed to accept as a detailed balance-sheet. We find that fire and marine premiums are now put in in a different form, whereas in all previous balance-sheets the gross annual revenue from these premiums was shown, and reinsurance charged on the debtor's side. A new mode is now introduced, and the shareholders are not afforded any information as to how much business had been clone. It reads, "By fire and marine premiums, less reinsurances, £16,072 165." Now we come on to the other side : Agents' commissions, salaries, and other expenses, ;£7,052 Is. 6d.; underwriters' associations and fire-brigades, £562 195.; Government licenses, rates, and taxes, £596 9s. ; interest, £1,611 2s. 9d.; office furniture, stationery, preliminary expenses, depreciation of property and bad debts, £2,014 lis. sd. ; appropriation for unadjusted and probable losses, £669 16s. 5d.; fire and marine losses, £20,990 15s. Bd.; less appropriation for December 1888, £7,854 Bs. sd. ; net, £13,136 7s. 3d.: total, £25,743 7s. 4d.—to do a £16,072 16s. 2d. business : leaving a debit balance or loss of capital at that time of £38,187 9s. 6d. With regard to this balance-sheet, it is the last balance for the year ended the 31st December, 1890. This balancesheet should have been in the hands of the shareholders at a very much earlier period: the fact is it reached the Hokitika shareholders on Wednesday, 7th March, 1891, whilst the general meeting