‘WAR DIARY. ARMY HEADQUARTERS, INDIA. […] I.E.F. “D”. Volume 41. PART II. (From 16th to 31st December 1917).’ [‎87r] (178/508)

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been gained of the requirements of the new administration, to make any formal
delegation of financial powers to the General Officer Commanding, other than
those which he possessed under the provisions of the Field Service ^Regulations
and Accounts Manual (War). Rut instructions w T ere issued to the Field
Controller of Military Accounts, Force “ D,” to audit the receipts and charges
of the administered territory In practice, however, the local authorities
submitted portions of their accounts respectively to the Field Controller and
to the Comptroller, India Treasuries, while in the case of certain transactions
they did not render any accounts to any regular Accounts officer.
In September 1915, the banking business of the Administration at Basrah
was transferred to the local branch of the Eastern Bank and a treasury was
also established at Basrah, for dealing with the accounts of the Administration.
This treasury, like similar institutions in India, had of course, no audit func
tions—its duties being mainly confined to the preparation of a proper record of
the receipts and payments of the AcTministranon for submission to the Accounts
Department.
*Enolosui e iNo. 3.
3. In February 1916, the Central Controller of War Accounts, who bad
been entrusted with the task of adjusting the receipts and charges of the
Administration, discovered that complete accounts were not being rendered to
any Accounts officer of the Government of India and he asked the Chief Poli
tical Officer, Basrah, to send him statements of complete receipts and charges
together with such accounts as bad. not already been rendered to the Accounts
Department of the Government of India. Simultaneously, Sir Percy Cox
proposed in his telegram of the 17th
February 1910,* that the Chief Political
Officer at Basrah should be invested with full authority to dispose, under the
Army Commander’s general control, of the accounts of the administered
territories. We were unable to accept the suggestion which was incompatible
with a proper discharge by us of the responsibilities imposed on us by His
Majesty’s Government m respect of the administration of the occupied
territory; and in our Foreign and Political Department letter No. 577-Est. B.,
dated the 7th April 1916,f we asked the
Chief Political Officer to submit the
tEnclosure No. 4.
accounts of the Administration to the Central War Controller for audit anid
adjustment. Before arriving at this decision, we carefully considered, in consul
tation with our Comptroller and Auditor-General, the question of the machinery
for dealing with the audit and adjustment of these accounts; and we came to
the conclusion that the best workable arrangement, at any rate for some time
to come, would be to entrust the whole work to the Central War Controller.
As you are aware, we had about that time decided to withdraw the bulk of the
Military Accounts staff employed in connection with the accounts of Force
“D” from Basrah to Poona; and the staff left at Basrah vvould have been
unable to deal efficiently with the accounts of the occupied territory.
4. Later on, in June 1916, we received from the Chief Political Officer,
Basrah, the communication and the memorandum, which form, respectively,
enclosures Nos. 7 and 8 of this despatch. In these two documents, the local
authorities pressed on us the view 7 that the supreme financial control over
the occupied territories vested, under international law, in the Commander of
the Army of Occupation, subject to the advisory control of His Majesty’s
Government, and asked that, if the Government of India were unable to accept
this position, the matter should be referred for the consideration of His
Majesty’s Government. In view, however, of the fact that the administrative
control (which naturally included the financial control) of the occupied
territory had already been vested in us by His Majesty’s Government (see your
telegram dated the 16th December 1914) and of the subsequent correspon-
tricte correspondence ending with our Finance d( 3 nce* On the Subject of the finances and
Department despatch No. 129, dated the 2 Jth accounts of the territory, W T G thought it
May 1916. unnecessary to refer to you the question
of our powers of control over the local Administration ; and w 7 e simply reported
the facts to yon in our Foreign and Political Department telegram, dated the
17th July 1916. We now submit, for your information, the complete papers
bearing on the subject.
5. The experience of the preceding tw'elve months had, however, con
vinced ns that it w 7 as desirable to give to the local authorities wide powers of
sanctioning expenditure in connection wfith the administration of the occupied
territory; and, after discussion with the officer who had been deputed by them