Former Progressive Democrats leader Mr Dessie O'Malley has warned accountancy firms that if the audit profession could not regulate itself professionally, it must be imposed by legislation.

He accused the big firms in Dublin of being exempt from effective control and said auditing appeared to be less important to the firms, who looked on it as a "kind of loss leader" to enable them "get their leg in the door and make a great deal of money from the consultancy side of their activities".

In a criticism of the Institute of Chartered Accountants in Ireland, he said a small number of very large firms in Dublin dominated it and they "seem to be exempt from any form of effective control, whatever the lip-service may be at a given time".

Mr O'Malley, minister for industry and commerce in the early 1990s, said that during his tenure the institute had struck off just one accountant in the previous decade.

During the debate on the DIRT inquiry report, he said that no action had been taken against auditors involved in a "serious dereliction of duty" in relation to the beef tribunal.

In one case a firm continued to act for a beef company involved in serious instances of major tax evasion and continued to "facilitate and connive at major serious tax evasion amounting to many millions of pounds".

He could not help contrasting "the speed, clarity and effectiveness of the [DIRT] report with what happened at the beef tribunal in the manner of the hearings and the nature of the report, which was shameful".

The findings of the DIRT report pointed to a need to raise standards across a wide range of business and professional activities, including the banking sphere.

"Raising these standards, either by way of improved, transparent and credible self-regulation on the part of professional bodies or by way of new legislation which is effectively enforced is as important to sustaining our prosperity as lowering taxes and increasing competition."

He added: "It is also necessary that the State examine its own conscience and ensure that legislation is appropriate and properly enforced."