Accountants concerned over gardai visits

The leading accountancy bodies have expressed concern about gardaí from the Office of the Director of Corporate Enforcement (ODCE) visiting the offices of auditors, writes Colm Keena.

Gardaí from the office have paid visits to auditors' offices following the reports which auditors are now obliged to file in instances where they come across possible indictable offences under company law.

The matter was raised during the first meeting of the ODCE/ Recognised Accountancy Bodies Liaison Group, held in March, the minutes of which have been recently posted on the ODCE website. The attendance at the meeting included representatives of all the main accountancy representative bodies.

According to the minutes the accountancy bodies "conveyed to the ODCE that certain of the auditor members had expressed concern that ODCE follow-up procedures to indictable offences reports, involved gardaí calling to their offices to pursue inquiries".

"The view was expressed that there is uncertainty and concern among practitioners as to how to deal with such inquiries and that, as the reporting responsibility is still relatively new for auditors, this is perhaps one topic that could be addressed in a code of practice."

The director, Mr Paul Appleby, said it was understandable that auditors would not welcome face-to-face interviews with gardaí arising from their reports. "He went on to indicate that most initial inquiries were now proceeding by way of correspondence with auditors, and he expressed the hope that this approach would efficiently generate the information required for ODCE assessment purposes."

The minutes record that the matter was raised a second time after Mr Ian Drennan, corporate compliance manager with the ODCE, said that about 10 auditors who had written reports on issues related to directors' loans, had been written to by the ODCE for the purpose of seeking further information. Satisfactory replies had been received.

"A discussion followed on ODCE follow-up to auditors' reports. In that context [Ms Judy Fay, secretary, of the Institute of Chartered Accountants in Ireland] made the point that auditors are not accustomed to having members of the Garda calling unannounced to their offices demanding statements."

Mr Drennan said it was important to differentiate between gardaí following up on auditors' reports and gardaí calling on foot of a search warrant. He explained that where the gardaí were visiting on foot of an auditor's report, it would generally be by appointment for the purpose of obtaining information. Gardaí visiting on foot of a warrant, for obvious reasons, would not give notice of their intention to visit, Mr Drennan said.