B.—l [PT. ll].

Statement of Irregularities in connection with Public Moneys and Stores. The following statement of irregularities in connection with public moneys and stores is furnished in compliance with the terms of section 89 (2) (c) and (e) of the Public Revenues Act, 1926 : — Defalcations on the part of departmental officers are, unfortunately, more numerous than those recorded in last year's report. The largest of these irregularities appears under the heading " Post and Telegraph Department " and occurred in a small post-office under the control of a non-permanent Postmistress. The circumstances of the theft were by no means unusual, and the theft was not the result of any defect in the accounting system. The irregularity shown in the statement as having occurred in the Public Works Department concerned the hiring of privately-owned lorries for purposes of transporting materials to be used on construction works. As the result of collusion between lorry-drivers and the Department's representative, times and quantities were inflated over a period of several weeks —a form of fraud which it is particularly difficult to detect. The irregularity which occurred in the Treasury Department took place in a District Office. The defalcation was of such a nature that discovery within a short period was certain, and no alteration in departmental procedure has been thought necessary. The irregularity in the Department of Industries and Commerce, Tourist and Publicity took the form of misappropriation of the proceeds of railway ticket and other similar sales, and was also of a nature which could not long escape detection. From the foregoing comments it is evident that no major defalcation has been facilitated by weakness in departmental systems, but the Audit Office is constantly on the watch to guard against the possibility of loss through laxity or through lack of appreciation of the benefits of internal checks. The Audit Office commented in its previous report upon the advantages of requiring periodical certificates from officers responsible for the maintenance of efficient systems of internal check, and although considerable progress has already been made I hope to secure an extension of these benefits at an early date.

STATEMENT.

XIV

Nature of Irregularity. involved'. Action taken, and ltesult. J Agriculture Department. IRREGULARITY BY PERSON NOT A DEPARTMENTAL Ol'FICER. £ s. d. Theft of sheep .. .. .. • • I 66 10 0 1 Police investigations unsuccessful. Air Department. IRREGULARITY BY PERSON NOT A DEPARTMENTAL OFFICER. Loss of boots .. .. •• •• 17181 Police investigations unsuccessful. Army Department. IRREGULARITIES BY DEPARTMENTAL OFFICERS. Misappropriation of departmental moneys .. Offender deceased. Police inquiries re missing rifle (£2 2s. lOd.) and theft of stores ' unsuccessful. Theft of stores .. .. . • • • 15 8 0 Offender convicted and placed on probation for one year. Part recovery effected. Manipulation of Stores Accounts .. .. 5 15 7 Offender called upon to pay the amount. Attempt to remove stores .. .. .. Not stated Police notified. Stores recovered. IRREGULARITIES BY PERSONS NOT DEPARTMENTAL OFFICERS. Theft of stores .. .. •• •• 16103 Police investigations not yet complete. Theft of machine guns and accessories . . 130 10 0 Offender sentenced to three years' reformative deten. tion. Part recovery made. Theft of arms .. .. •• •• 1173 Police investigation unsuccessful. Theft of stores . . .. .. • • Not stated Police investigations not yet complete. Theft of rations .. .. .. • • Not stated Offender fined £10 and ordered to make restitution. Overpayment of camp pay; false statement 6 7 3 Offender admitted to probation for six months or regarding repayment until such time as he might be called up. Education Department. IRREGULARITY BY PERSON NOT A DEPARTMENTAL OFFICER. Theft of stores .. .. .. •• I 0 12 11 I Police investigation unsuccessful.