Ulster Bank audit process criticised

While scrupulous adherence to tax compliance procedures was demanded by top management in Ulster Bank, this was at variance with…

While scrupulous adherence to tax compliance procedures was demanded by top management in Ulster Bank, this was at variance with the practice discovered by internal auditors in parts of the branch network, according to the Committee of Public Accounts report.

The report notes that the bank had a problem with non-resident accounts, with the necessary documentation apparently absent, faulty or incomplete. Deficiency levels, as measured by internal audit sampling, showed the problem peaked in 1991, when 69 per cent of the sample audited was deficient.

While the internal audit regime appeared impressive, it did not check for the authenticity of account holders, thus diminishing the value of the audit process, the report found.

It also notes that where breaches of the tax laws were discovered at Ulster Bank, there was no evidence the disclosure was made to the Revenue Commissioners, or that arrears of DIRT were paid.

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The committee also warned that a 1993 Ulster Bank review of accounts which were reclassified from non-resident to resident could not be relied on by the Revenue Commissioners for calculating the bank's liability.