A.D. 1923.

Balance sheets and audit.

Annual accounts and returns.

Inspection.

Accounts, Returns, Inspection, Valuations, Meetings.

15.-(1) A copy of every balance sheet of a collecting society shall, during the seven days next preceding the meeting at which the balance sheet is to be presented, be kept open by the society for inspection at every office at 5 which the business of the society is carried on, and shall be delivered or sent by post to any member or person interested in the funds of the society, on demand.

(2) The audit of accounts required by section twentysix of the Friendly Societies Act, 1896, shall, in the case 10 of a collecting society, be made by a public auditor appointed under that Act, and if such accounts have not been so audited, the provisions of section twenty-seven of that Act requiring an annual return of the receipts, expenditure, funds and effects of the society as audited 15 shall be deemed not to have been complied with.

16. (1) The Commissioner, after considering any representations made by or on behalf of the society or company affected, may, if it appears to him that any account, return, or balance sheet sent by a collecting 20 society or an industrial assurance company in pursuance of the Friendly Societies Act, 1896, or the Assurance Companies Act, 1909, is in any particular incomplete or incorrect, or does not comply with the requirements of the Act applicable to the case, reject the account, return, 25 or balance sheet and give such directions as he thinks necessary for the variation thereof.

(2) Where any direction so given entails a consequential alteration of any account, return, or balance sheet sent by an industrial assurance company to the Board of 30 Trade, it shall be the duty of the company to make such consequential alteration therein.

17.-(1) If, in the case of any collecting society or industrial assurance company, in the opinion of the Commissioner there is reasonable cause to believe that an 35 offence against this Act or against the Friendly Societies Act, 1896, or the Assurance Companies Act, 1909, has been, or is likely to be committed, the Commissioner or any inspector appointed by him for the purpose shall have power to examine into and report on the affairs of the society or 40 company, and for that purpose may exercise in respect of the society or company all or any of the powers given by subsection (5) of section seventy-six of the Friendly Societies Act, 1896, to an inspector appointed under that section.

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(2) On himself holding such an inspection or on A.D. 1923. receiving the report of an inspector so appointed the Commissioner may issue such directions and take such steps as he considers necessary or proper to deal with 5 the situation disclosed therein and in particular may in the case of a society award that the society be dissolved and its affairs wound up, and in the case of a company may present a petition to the court for the winding up of the company.

10 (3) The Commissioner may, if he considers it just, direct that all or any of the expenses of and incidental or preliminary to an inspection under this section shall be defrayed out of the funds of the society or company, or by the officers or former officers, or members or former 15 members of the committee of management or bcard of directors of the society or company, or any of them in such proportions as the Commissioner directs and sums directed by him to be so paid shall be recoverable by him summarily as a civil debt.

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(4) This section shall come into operation on the passing of this Act.

tions.

18.-(1) In the case of a collecting society or Provisions industrial assurance company, the following provisions as to valuashall have effect with regard to every valuation made as 25 at the thirty-first day of December, nineteen hundred and twenty-four, or any later date :

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(a) The valuation shall be made by an actuary as
defined by the Assurance Companies Act, 1909,
as modified by this Act;

(b) The basis of valuation adopted shall be such as to
place a proper value upon the liabilities, regard
being had to the mortality experience among
the persons whose lives have been assured in the
society or company, to the average rate of
interest from investments and to the expenses
of management (including commission), and
shall be such as to secure that no policy shall be
treated as an asset;

(c) The report containing the abstract of the result
of the valuation required by section twenty-eight
of the Friendly Societies Act, 1896, to be sent
shall be sent by a collecting society to the Com-
missioner within twelve months after the close of
the period to which the valuation relates, and
shall contain a statement as to how the values of

A.D. 1923.

stock exchange securities (if any) included in the
balance sheet are arrived at, and a certificate,
signed by the same persons as sign the balance
sheet, to the effect that in their belief the assets
set forth in the balance sheet are in the aggregate 5
fully of the value stated therein less any invest-
ment reserve fund taken into account;

(d) Where the balance sheet of a society or company
includes amongst the assets thereof any sums
representing expenses of organisation or exten- 10
sion, or the purchase of business or good will,
and the amount of the assets, exclusive of such
sums (after deducting debts due by the society
or company other than debentures and loans),
is less than the amount of the industrial 15
assurance fund, or, as the case may be, of the
several assurance and insurance funds as shown
in that balance sheet, the amount of the
industrial assurance fund shown in the valua-
tion balance sheet shall be reduced by the 20
amount of the deficiency, or, as the case may
be, by a sum bearing such proportion to that
deficiency as the amount of the industrial
assurance fund shown in the first-mentioned
balance sheet bears to the aggregate amount 25
of all the assurance and insurance funds so
shown:

Provided that in the cases hereinafter mentioned this paragraph shall, during such periods as are hereinafter mentioned, apply to societies and 30 companies subject to such relaxations of the stringency of the provisions thereof as the Commissioner may think just; that is to say

(i) in the case of a society or company in the balance sheet of which last issued before 35 the passing of this Act any such sums as aforesaid were included, for a period of seven years after the passing of this Act;

(ii) in the case of a society or company which, after the date as at which the balance 40) sheet last issued before the passing of this Act was made up, has under an amalgamation or transfer of engagements become liable for the engagements of any other society or company and has in consideration thereof 45

accepted assets which include any such sums A.D. 1923.
as aforesaid, or has in connection therewith
incurred expenditure by way of purchase of
business or good will, for a period of seven
years after the thirty-first day of December
next following the date of amalgamation or
transfer of engagements;

(e) Where debentures have been issued or loans
raised which are charged on any of the assets
of the company in which the industrial assurance
fund is invested there shall be inserted in the
valuation balance sheet a note giving the par-
ticulars of the charge and stating that the result
shown by the valuation is subject to the liability
under the charge;

(f) The Commissioner, if satisfied on any valuation
that any of the foregoing provisions of this sec-
tion have not been complied with, or that the
industrial assurance fund as stated in the valua-
tion balance sheet is greater than the value of
the assets available for the liabilities of that fund,
due regard being had to the other liabilities of
the society or company and to the foregoing pro-
visions of this section, may reject the valuation,
and may direct the society or company to make
such alteration therein as may be necessary to
secure compliance with those provisions:

Provided that the society or company may
appeal to the High Court or in the case of a
society or company registered in Scotland to the
Court of Session against any decision of the
Commissioner under this paragraph;

(g) The Commissioner may direct any collecting
society or industrial assurance company to
furnish to him, in addition to such information
as the society is required to furnish under
section twenty-eight of the Friendly Societies
Act, 1896, or the company is required to furnish
under the Assurance Companies Act, 1909, all
or any of such particulars as are mentioned in
the Second Schedule to this Act, and such
explanations as he may consider necessary in
order to satisfy himself whether the valuation
complies with the provisions of this section.

A.D. 1923.

General meetings.

(2) Notwithstanding anything in section twentyeight of the Friendly Societies Act, 1896, or section five of the Assurance Companies Act, 1909, the first valuation under this Act shall in the case of any collecting society and industrial assurance company be made as at 5 a date not later than the thirty-first day of December, nineteen hundred and twenty-five.

(3) If in the case of a collecting society or industrial assurance company a valuation, whether made before or after the passing of this Act, discloses a deficiency the Commissioner may if after investigation he is satisfied 10 that the society or company should cease to carry on industrial assurance business, award that the society be dissolved and its affairs wound up, or, in the case of a company, present a petition to the court for the windingup of the company :

Provided that the Commissioner shall not during the first five years after the passing of this Act take action under this subsection if he is satisfied that substantial measures are being taken to improve the financial condition of the society or company.

19.-(1) At least one general meeting of every collecting society and industrial assurance company shall be held in every year.

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(2) Except where the day, hour, and place of an annual or other periodical meeting is fixed by the rules, 23 notice of every general meeting shall either be given by the society or company to the members by advertisement to be published at least twice in two or more of the newspapers in general circulation in every county where the society or company carries on business, or be served 30 upon every member.

(3) The notice shall specify the day, hour, and place, and the objects of the meeting, and in case any amendment of a rule is intended to be proposed, shall contain a copy of every such amendment.

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(4) The society or company shall publish the last of such advertisements, or serve such notice as aforesaid, at least fourteen days before the day appointed for the meeting, and shall during those fourteen days keep a copy of the notice in legible characters affixed in some 40 conspicuous place in or outside every office at which the business of the society or company is carried on.