8.—9.

In addition, as the result of altered circumstances or of new facts being brought under notice, it has been necessary to make provision in this year's accounts for further similar losses. It is pleasing to report, therefore, that, notwithstanding the foregoing unusual charges, and after making adequate provision for depreciation of office property, the net profit for the year amounted to £12,964. 22. Deposits under the Life Insurance Act, 1908. —In terms of the Life Insurance Act, 1908, and its amendments, every company carrying on life-insurance business in New Zealand is required to deposit with the Public Trustee money or certain classes of securities commensurate with the total amount assured by its policies, but with a maximum deposit of £50,000. The amount of cash and securities deposited with the Public Trustee on the 31st March, 1938, in accordance with this Act was £759,517, the number of companies concerned being sixteen. 23. Deposits under the Insurance Companies' 1 Deposits Act. —Cash deposits under the provisions of the Insurance Companies' Deposits Act, 1921-22, and its amendments, are required to be lodged with the Public Trustee by all foreign insurance companies carrying on business (other than life, earthquake, and marine insurance) in New Zealand. The amount of the deposit required of each company varies in accordance with the nature, but not the volume, of the business conducted. On the 31st March, 1938, the capital amount of deposits held under this Act on behalf of thirty-seven companies was £1,110,000. The interest on this sum is paid at regular intervals to the companies concerned. The Act and its amendments make provision for deposits to be lodged not only by foreign companies, but also by agents of foreign underwriters operating in New Zealand. A further amendment of the Act was made during the year under review by section 56 of the Finance Act, 1937, which provides that every person who, in the course of his business, negotiates or attempts to negotiate any contract of insurance between an insurance company or an underwriter and the insured, shall be deemed to be the agent of the company or underwriter, and the latter shall be deemed to be carrying on insurance business in New Zealand. In such circumstances the company or underwriter would be liable to lodge with the Public Trustee a deposit in accordance with the class of insurance business which was being undertaken. 24. Advances to Estates and Beneficiaries. —In previous reports mention has been made of the necessity of providing funds for the payment of debts, death duties, and other pressing liabilities, as well as for current living-expenses of dependants, within a comparatively short period from the date of a person's decease. In many cases it is found that whereas the amount of cash and readily realizable assets may have been ample to cover a living person's requirements and to meet his liabilities, the additional liabilities (principally death duties) which come into existence immediately following death frequently place an estate in an embarrassing position financially. This difficulty can, in the case of most estates administered by the Public Trustee, be readily overcome by virtue of the statutory powers which enable him to advance money to such estates on the security of the assets. The provision of this accommodation entails no legal costs and, in addition, there are very material advantages —viz., that a low rate of interest is payable on such advances, and that as soon as moneys are available to be applied in reduction of the advance, the interest charge ceases upon the portion repaid. With accommodation of this nature available the Office is also able to postpone the realization of assets in cases where the market is unfavourable or where for other reasons, it is undesirable to attempt to sell. For the purposes of land-tax an advance by the Office to an estate owning land is equivalent to a registered mortgage over such land, and upon a certificate by the Public Trustee regarding the amount of the advance being filed with the Commissioner of Taxes a deduction for land-tax purposes is allowed in respect of the advance in the same way as though it were secured by a registered mortgage.

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