Cliff Taylor: RTÉ’s Bosco accounting involves trip beyond Magic Door

Why was the decision to hide part of Ryan Tubridy’s salary taken? It remains unclear after the thousands of words released in statements and spoken at Oireachtas committees this week. There is no question but that the intention was to conceal the payments – and considerable expense and trouble was taken to do this, both in the original deal with Renault and in the subsequent payment from the barter account, triggered by misleading invoices. And by publishing incorrect information on Tubridy in the earnings of the top 10, going right back to 2017. But why?

The most obvious answer is that senior figures in RTÉ didn’t want the wider public, the rest of the organisation – including other high-earners – or the Government to know that Tubridy was being paid so much. But this also has the look of someone already in a hole deciding to just keep digging. When Renault pulled out of the original deal designed to deliver an additional €75,000 a year to Tubridy, Dee Forbes – conscious of the unwise agreement to underwrite the deal – decided to try to pay for the subsequent two years via the disguised barter account agreement.

This account was in credit, we are told. But the flip side of this is that there was clearly no budget elsewhere for the additional payments. As well as continuing to hide this from the public, doing it this way with the misleading invoices for "consultancy”, ensured that very few people inside RTÉ knew what was going on, including the board.

Cork TD Christopher O’Sullivan invoked Bosco in one of the committee meetings this week. And he was right. To understand RTE’s accounting practices we have to go through Bosco’s Magic Door into the world of barter accounts and dodgy invoices, an off-balance-sheet universe not subject to normal financial controls and unknown to the board.

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Much of the terminology is a distraction. It appears barter accounts are common in the advertising sector and they are not, in themselves, a "bad thing” – if they are subject to proper oversight. The astonishing thing is that this fund operated outside normal financial controls in RTÉ and appeared to be reconciled at the end of the year into the main accounts, like some kind of petty cash account used to buy tea and coffee.

The use of the barter account to pay Tubridy was completely outside the normal use of such accounts. RTÉ's chief financial officer, Richard Collins, said he was told by Forbes that the two €75,000 invoices were for consultancy provided by Noel Kelly’s firm to the organisation. Prime Time reported that the same answer was initially given by Forbes to the board, when they queried her after auditors Deloitte raised a red flag. We have still to hear the former director general’s account of what happened, of course.

Corporate governance and internal controls are a terribly dull subject. Until something goes wrong. And what happened in RTÉ bears many of the hallmarks of other corporate controversies over the years – a hierarchical organisation with insufficient challenging of key decisions, a management team who knew bits of information but not the full story, and a board which was not being told what was happening behind the scenes.

[ Tubridy tumult saturates RTÉ: ‘The consequences are felt every hour in this building’ ]

[ Diarmaid Ferriter: Culture of ‘open secrets and secret secrets’ has always surrounded RTÉ pay ]

There are other questions. Deloitte spotted the two invoices for €75,000 raised in 2022, setting the whole affair off. The board, in fairness, reacted quickly. But what about the 2017-2019 period, when there is still disagreement about who knew what?

On January 20th, 2021, RTÉ published the pay of the top-10 earners for the 2017-2019 period, a process also overseen by Deloitte. This involved a €120,000 under-declaration of the money paid to Tubridy, which is now being probed by Grant Thornton. But this was before the barter account shenanigans. So what happened? And did the auditors at Deloitte sign off on it or not spot it?

Tubridy had been due an end-of-contract “loyalty” bonus of €120,000 as part of his 2015-2020 contract, the same amount as the earnings understatement for the three years. He never received the loyalty bonus, we are told. It is not clear how RTÉ had accounted for this expected liability.

However, was it the case that the understatement of Tubridy’s earnings between 2017 and 2019 was achieved by allocating the “saving” from not paying the €120,000 bonus over the previous three years?

Now, I know we are behind the Magic Door again here. But RTÉ has told us that the loyalty bonus was not paid – and also that €120,000 was subtracted from his earnings over the three years. In the first year, this was €20,000 and €50,000 in the subsequent two years – meaning the amounts in the published top-10 list was incorrect.

It does not seem that Tubridy received additional cash payments in the three years beyond the terms of his contract.

Rather, from what we are told, it seems possible that someone in RTÉ decided to use the fact that the loyalty bonus was not being paid to retrospectively reduce the published payments for the presenter for the previous three years. On the face of it, this makes no sense. But as Sherlock Holmes was fond of saying, when you have eliminated the impossible, whatever remains must be the truth.

We await Grant Thornton’s review. Whatever precisely happened, it had the effect of reducing the reported earnings of Tubridy to just below €500,000 for the three years, despite the fact that the cash he received in each year had been in excess of that figure. Clearly some people in RTÉ knew about this.

From a common sense point of view, much of what went on was misleading and just plain wrong. Whether any of it is actually illegal remains to be seen. There will be endless chatter now about trips to matches, cars given to RTÉ stars and so on. The financial pressures on the organisation will increase. Finding a way forward will not be easy. But first we need to find out exactly what happened in the key transactions at the heart of this story – and why.