How company law affects FAI
Auditors Deloitte issued a formal notice to the Company Registration Office stating that "proper accounting records" were not kept at the FAI, which is a limited company and subject to company law.
Specifically, the FAI said it had contravened Sections 281 and 282 of the Companies Act 2014 - the rules on adequate accounting records.
It did not say when or how the alleged breaches had happened or indicate what had happened to cause the auditors to make the dramatic move.
The unusual step of reporting the failure was made on Friday, April 12, using a standard form known as a H4.
Because of the time involved in processing corporate filings, the document only became publicly available yesterday. The FAI itself would have been aware in advance.
Failing to keep proper books of accounts is a specific offence under Sections 281 and 282 of the Companies Act.
In extreme cases it can lead to jail sentences and heavy fines, specifically if it resulted in people being left out of pocket, or if it made it harder to shut a business down in an orderly fashion.
Generally speaking those issues are only thrown up if a company goes into liquidation.
But the simple fact the H4 form was sent to the Companies Office triggers a knock-on action of the issue being brought to the attention of the Office of the Director of Corporate Enforcement, the State's white-collar crime enforcement agency.