At 8.30 a.m. last Thursday morning, eight summer interns at Deloitte & Touche, the accounting firm, made a presentation on behalf of a client in the company's boardroom in The Corner House.

All the interns are still at university and none are qualified accountants. But the summer students, while unusually numerous for a firm of Deloitte's size, have not spent their summer doing clerical grunge work. Continuing a programme that began last summer, they were given a project: analyse the benefits and pitfalls of the duty system, and compare it with a sales tax on local retail purchases.

"This is not the best time of year for public accounting firms," said Roger Titterton, a partner at Deloitte's, so the projects ensure that the students have work to do.

Before it restructured its summer intern programme last year, Deloitte's only took on one or two students every summer. Last summer, that number grew. During their three months with the firm, one of the students' tasks was to come up with ways to increase revenues at a tourist attraction. The management of the attraction adopted most of the students' suggestions, including a partnership with the cruise lines to ensure a more steady flow of visitors.

For this particular project, the students investigated the current duty system and procedures, interviewed retailers and questioned consumers about their shopping habits (which often involve a trip to the airport, not Front Street). With the aid of a laptop, Microsoft Power Point and a projector, they presented their findings (but no conclusion) to Heather Jacobs Matthews, the Tax Commissioner, and Donald Scott, the Government's Financial Secretary. (The Minister of Finance was also invited, but did not attend; the House of Assembly adjourned just four hours earlier.)

The students did not offer outright support for one system or the other, although they revealed that the choice between a sales tax and duty is not simply a decision between inclusive prices and pesky additions at the cash register.

Many of the retailers the students spoke to favoured a sales tax. With lower price tags, they claimed, consumers might be more inclined to buy products, even if they eventually pay extra at the register. Buyers would also see how much of their money goes to Government and how much goes to the retailer. A sales tax would also improve cash management for retailers, who would remit tax after an item was sold, not before. The would also only have to pay when a product is sold.

The Government would be able to assess a tax on the retail value of the good, not the wholesale value paid by retailers. If retail sales improved, so too would Government's collections of sales tax. And with sales taxes, taxation of services - which was of particular interest to Mr. Scott - could also be introduced.

The students calculated that a sales tax would need to be about four or five percent to make up for the revenue lost from duty.

But a sales tax would give Bermudians reason to develop a black market, one in which goods are sold, no record is kept and sales taxes are not paid. While Government already commits resources to collecting duty, the interns determined that the labour required to ensure that tax is paid when it should be could be much more costly. They also pointed out the cost of converting from the current system to a new one.

The discussion was lively, even if there was no definitive we-should-do-this conclusion, except that consumers needed to be better educated about how retailers calculate the prices they charge.

"This problem is too big and too complex to figure out in a summer," said Mr. Titterton.

The assignment was one of two the students will complete this summer. For the second project, the students will draw up possible solutions, some and some not related to accounting, for a retailer seeking to increase its sales.

But the summer intern programme is not just about projects.

Ricardo Cardoso is in the programme for the second year, after finishing the third year of an accountacy degree at the University of New Brunswick. When Mr. Cardoso is not working on a project with the other students, he accompanies audit seniors to the offices of clients under review.

Auditing has never developed a reputation for being scintillating, but Mr. Cardoso said he enjoys working with numbers and seeing how businesses work from the inside. The real-world exposure, he said, was unusual for interns at the so-called "big five" accountancy firms.

"I have a passion for accounting," he said. "And when you are auditing, you get a better perspective of how the accounting procedures work."

For Deloitte's partners, the summer intern programme is a recruiting exercise or sorts. Mr. Titterton said the main benefit for the firm was the opportunity to look at students and potential future employees.

"We are trying to introduce them to the firm," Mr. Titterton said, "so they can have a look at the type of work we do."

Mr. Cardoso is pretty confident that once he finishes his degree, he will land a job with Deloitte's.

"I'm definitely going to apply to work with them somewhere else," he said.