Fears that the institute may have to abandon its plans to develop a proposed Kerry Sports Academy come as the institute has issued a warning about its deteriorating financial situation.
The comptroller and auditor general Seamus McCarthy raised concern during an audit of the institute’s annual accounts about its expenditure of €339,000 on design team fees related to the proposed development of a €15m sports academy building on the campus.
Mr McCarthy noted that the institute’s accounts recognised there was a risk that the building may not be constructed unless sufficient funding is generated.
It has also emerged that the institute is to wind down a limited company which it established last year to facilitate the building of the sports academy.
The institute said a change of circumstances had led to the decision to wind down Dromtacker Sports which had been set up as a 100%- owned subsidiary of the institute specifically to explore options in the financing and operating of the academy.
A spokeswoman for the institute acknowledged it so far only had €5m funding in place out of the €15m needed but was “actively progressing its fundraising programme”.
She stressed the institute was confident of securing the remaining funding necessary to develop the sports academy which will have a particular emphasis on adapted physical activity and will host Unesco’s first worldwide chair in inclusive physical education, sports, fitness and recreation.
“The project has successfully reached pre-tender stage with full planning permission granted, thereby enabling the project, should additional funds become available, to progress to the next stage of development without delay,” said the spokeswoman.
The institute successfully appealed a requirement to pay development contribution levies of €374,000 to Kerry Co Council last year.
It has also secured some substantial philanthropic donations from a number of parties including €1m each from the Kerry Group, the JP McManus Benevolent Fund and Croke Park/ the GAA’s Munster Council as well as €600,000 from Cairde Chiarraí and €400,000 from Kerry GAA.
Meanwhile, the latest annual financial report for the institute also highlights how it recorded an operating deficit of €828,000 last year compared to a surplus of €1.25m in 2012.
“The institute is aware that further deficits of similar magnitude will result in the reduction of reserves that could call into question the future going concern status of the institute in the near to medium term,” said the president, Oliver Murphy and acting chairman, Terry O’Brien.
However, they stressed the institute had sufficient reserves to meet projected expenditures up to the end of the 2016/17 academic year.
However, overall student numbers fell 4.6% to just under 2,900 last year while staff numbers remained virtually static at 317.
The institute is also in negotiations with the Cork Institute of Technology and the Higher Education Authority about the establishment of a Munster technology university. A decision on such a merger is due before the end of November.