The Revenue is advanced in its assessment of non-resident accounts to determine an estimation of the level of DIRT under-deducted by the financial institutions since 1986.

Audits of accounts in 28 of the 40 financial institutions under investigation have begun. The Minister for Finance, Mr McCreevy, told the Dail yesterday the Revenue hopes to have its auditing work completed by the middle of this year.

Following completion of these "look-back audits", the Revenue will seek to agree with each financial institution the amount of under-paid DIRT liabilities along with interest and penalties.

Mr McCreevy said it is "possible that everybody who evaded tax using a bogus non-resident account will be investigated in due course".

Mr McCreevy was speaking in the Dail on a debate reviewing progress in the implementation of the recommendations made in the Dail Committee of Public Accounts DIRT report which was published in December 1999.

He also confirmed a new reporting system has been established between the Department of Finance and ACCBank following the criticism of the State-owned bank in the PAC's report. As part of the new arrangements, Mr McCreevy will meet with the ACC chairman "on at least a quarterly basis and there will also be quarterly briefings between the chief executive and officials at the Department of Finance". Mr McCreevy will also meet with the full board of the bank once a year.

The Department of Finance and Revenue submissions to the auditing review group have proposed the involvement of a State agency in a system to provide for the independent supervision of auditors.

Mr McCreevy also said the Central Bank has requested all credit institutions to submit their internal codes of ethical practice for assessment.

It was confirmed the Government has decided not to proceed with the suggested levy on the financial institutions due to constitutional difficulties. However, the chairman of the PAC, Mr Jim Mitchell, said a voluntary act of reparation on the part of the financial institutions "would still be appropriate". Mr Mitchell noted that the work of the DIRT Inquiry was "not concluded but merely suspended". The Committee will meet on June 20th June next to review progress.

The full text of the PAC's DIRT report is available on The Irish Times website at www.ireland.com/newspaper/ special/