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Accounting Error

Report on €3.6 billion accounting error may be published next week

Both an internal investigation and external review have been completed, with Michael Noonan now left to seek government approval.

THE REPORT on the circumstances of how Ireland’s general government debt was overstated by €3.6 billion in figures for 2010 may be published next week.

The Dáil’s Public Accounts Committee has been told that both an internal investigation and an external report into the error, carried out by Deloitte Consultants, have now been completed.

The secretary-general of the Department of Finance, John Moran, has written to the committee telling it that once “a few minor amendments” are incorporated into the Deloitte report, it will be presented to Michael Noonan.

The letter, dated last Tuesday, indicates that once this has been done, the report will only need to be presented to the government before it can be published in full and delivered to the committee itself.

Moran said he expected Noonan would “present a Memorandum to Government very shortly”, and that the intention – subject to the findings of the reports – then was that both reports would be made available to the public “as soon as is practicable” after the government had received them.

While the cabinet will hold its usual meeting tomorrow, Noonan will not be present, as he is attending meetings of the Eurogroup and ECOFIN in Brussels today and tomorrow.

It is possible, therefore, that the reports could be approved by the Cabinet at its meeting next week and then published.

The CSO explained that the error, which came to light last November, had arisen when a €3.6 billion loan taken out by the Housing Finance Agency from the National Treasury Management Agency was treated as if it had been borrowed externally, as all previous HFA loans had been.

This meant that the HFA’s external debts, and therefore the debts of the government overall, were reported as being €3.6 billion higher than they actually were.

There was no benefit to the public purse, however, as the NTMA’s loan was incorrectly recorded as a bank deposit – thereby becoming a government ‘asset’ – rather than a mere transfer of cash from one State body to another.

The end result of the dual error meant that both the government’s assets and debts were recorded as being €3.6 billion higher than they should have been.

Read: State ‘no better or worse’ off as result of €3.6bn accounting error, says CSO

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