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Saturday 25 March 2017

C&AG report into affairs at Red Cross 'inaccurate'

DANIEL McConnell Chief Reporter

The Comptroller and Auditor General's report into the goings-on at the embattled Irish Red Cross (IRC) charity was widely inaccurate, contained significant factual errors, and "blindly reported" the IRC's version of events, according to the whistleblower sacked by that organisation last year.

Mr Noel Wardick, a former head of International Development with the IRC, who was fired after he wrote a blog about alleged financial irregularities and the "toxic management culture" at the society, has written to the C&AG, Mr John Buckley; Justice and Defence Minister Alan Shatter and to John McGuinness TD, chairman of the Public Accounts Committee, to highlight what he believes are substantial errors. A copy of the letter has been obtained by the Sunday Independent.

"The C&AG's report made no reference whatsoever to the statement by IRC's external auditors, BDO, that the society is in breach of Standard Accounting Practice for Charities because of its failure to properly account for or record its extensive property portfolio, which it has received over many years via public donations," Mr Wardick wrote.

In response, the IRC said the precautionary insured value of these properties is approximately €7m "though we anticipate that the real value will be considerably less". The IRC said that the exercise was progressing with the aim to have property values added to the 2011 audited accounts.

Mr Wardick claimed the C&AG's statement that the IRC had commissioned an independent investigation into how €162,000 in donations for tsunami victims lay in a Tipperary bank account was inaccurate. While the IRC had initially earmarked Mazars to conduct the investigation, within a matter of weeks, it announced that the external examination was cancelled and replaced with an "internal enquiry".

Mr Wardick also stated that the €162,000 was only discovered following a "secret audit". While the C&AG claimed that during the tsunami appeal no additional staff were hired, Mr Wardick retorted that 10 additional posts were created as well as a number of posts in Sri Lanka.

Mr Wardick, who is now taking an unfair dismissal claim to the Employment Appeals Tribunal, also criticised the C&AG for the manner in which it examined corporate governance at the IRC where some key people have been in positions for over 20 years.

In response to Mr Wardick's letter, a spokesman for the C&AG said: "Although the Irish Red Cross Society receives substantial public funding each year, the Comptroller and Auditor General's remit does not include powers to audit or examine the affairs of the society.

"The concerns we addressed were around the importance of bodies in receipt of public funding being in a position to demonstrate good governance."

Sunday Independent

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