NOTE ISSUE INCLUSION OF FIGURES RELATING TO NOTE ISSUE IN BALANCE SHEET OF COMMONWEALTH BANK
COMMONWEALTH BANK ACT 1911, ss. 20, 60C, 60D, 60F, 60H: COMMONWEALTH BANK REGULATIONS, Form T
The Secretary to the Treasury has forwarded me the following minute for advice:
The aggregate balance sheet of the Commonwealth Bank of Australia, prescribed by the Regulations under the Commonwealth Bank Act 1911-1920, Form T, (Statutory Rules 1921 No. 4), includes in the liabilities and assets the total figures of the Note Issue Department.
- Section 60C of the Act reads as follows:
For the purposes of this Part there shall be a Note Issue Department of the Bank, which shall be kept distinct from all other departments of the Bank.
- I shall be glad if you will favour me with an opinion as to whether it is considered that the form of balance sheet prescribed by the Regulations is inconsistent with that portion of the Act above quoted.
- Departmental papers are attached.
The Note Issue Department is managed by a Board of Directors of which the Governor of the Bank is ex officio chairman (section 60D).
Section 60F provides that on a date to be fixed by proclamation the assets and liabilities of the Treasurer under the Australian Notes Act 1910-1914 shall be transferred to the Note Issue Department of the Bank.
The Board is authorised to issue Australian notes and each note must bear the promise of the Treasurer to redeem it in gold coin on demand at the Head Office of the Commonwealth Bank.
Sub-section (2) of section 60H provides that upon the commencement of the Act, Australian notes expressed to be payable at the Commonwealth Treasury at the seat of Government shall be payable at the Head Office of the Commonwealth Bank.
From the above provisions, it will be seen that the assets and liabilities of the note issue upon transfer became assets and liabilities of the Note Issue Department.
With regard to the inclusion of the figures relating to the note issue in the Bank's balance sheet, I am of opinion that the Governor-General may, under section 20, prescribe a form providing for the inclusion of such figures. So long as the form enables the figures to be kept distinct, the form is, in my opinion, not inconsistent with the provisions of section 60C of the Act.
I think further that the form contained in Statutory Rules 1921 No. 4 does enable the figures to be kept distinct. Statutory Rules 1921 No. 4 are, therefore, not inconsistent with the Act.
[Vol. 17, p. 399]