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1902. NEW ZEALAND.

IMPERIAL WAR OFFICE EXPENDITURE (REPORT OF CONTROLLER AND AUDITOR-GENERAL AS REGARDS AUDIT OF).

Laid on the Table by Mr. Speaker.

The Contbollbr and Auditor-General to the Hon. the Speaker of the House of Representatives. The Controller and Auditor-General has the honour respectfully to report to the House of Representatives that the Treasury having informed him of the desire of the War Office that such expenditure connected with South Africa as is chargeable to Deposits of Imperial moneys in the Public Account may be audited only by the Defence Office, and proposed, with his concurrence, no longer to submit such expenditure for examination by him, he has since not been insisting, in respect of the vouchers for such expenditure, on compliance with the requirement of section 45 of the Public Revenues Act, that the Paymaster-General's requisitioas shall be comprised of vouchers passed by the Audit Office; and he begs leave to submit a copy of the correspondence on the subject. J. K. Wakburton, Controller and Auditor-General. The Hon. the Speaker of the House of Representatives.

No. 1. Copy of a Cablegram sent to the Agent-General, London, on the 3rd February, 1902. Consult War Office as to position taken up by Controller and Auditor-General, who considers his duty audit pay and claims chargeable Imperial funds for war expenditure. In my opinion local audit such expenditure unnecessary, as must certainly be audited subsequently by Imperial authorities. If War Office concur local audit unnecessary, cable instructions very fully.

No. 2. Copy of a Cablegram received from the Agent-General, London, on the 12th February, 1902. In answer to your telegram of third, Secretary of State for War attaches much importance to some local audit by colonial authorities prior to transmission of accounts to this country. Frequently difficult, if not impossible, to make thorough examinations in this country of such accounts, and therefore the Secretary of State for War relies upon the certificate of colonial authorities accompanied by vouchers. Accordingly the Secretary of State for War expresses the hope that Government of New Zealand will undertake preliminary examination (not necessarily elaborate) prior to sending accounts to War Office. London, Sub. 11.

No. 3. Copy of a Cablegram sent to the Agent-General, London, on the 28th February, 1902. Will you again approach War Office and say that local Defence Pay Office quite prepared to make preliminary and careful examination of accounts, and will append certificates as required. Great difficulty and delay arises from colonial audit persisting in elaborate thorough examination, which is direct cause of large accumulation of accounts of expenditure to stand over. Endeavour to get War Office approve of Defence Department thorough examination of vouchers. Am quite satisfied that this will be found satisfactory and sufficient for audit by Imperial Government.

No. 4. Copy of a Cablegram received from the Agent-General, London, on the Bth March, 1902. Referring to your telegram of 28th February, War Office are prepared to dispense with audit by Controller and Auditor-General on the understanding that proper vouchers are rendered and careful preliminary examination takes place of the accounts in the Defence Office. Each claim to be accompanied by the certificates of the Under-Secretary for Defence showing that the required examination has been duly carried out, and that all sums included in the claims are chargeable against Imperial funds, Sending accounts at the earliest possible date. London, Sub. 7.