Such was the scope of the Deloitte audit of Horse Sport Ireland that last week’s column could not give it the coverage it warranted.
Hence, this week I return to some of the more salient points in the comprehensive report, which runs to 61 pages.
For example, Deloitte noted that a wholly-owned subsidiary of HSI, Horse Sport Ireland Export Ltd had made losses of €113,493 as of December 31, 2014, but the consolidated financial statements of HSI and the subsidiary were not prepared by HSI on the grounds there is no requirement under company law.
Deloitte said “these losses by the subsidiary have not been disclosed in the 2014 HSI published Income and Expenditure Account and Balance Sheet, but are disclosed in a note in the HSI financial statements”.
However, HSI disagreed with the findings, “as it infers that the position regarding the wholly owned subsidiary was not disclosed in the HSI annual report”, going on to say that it was clearly shown as a note “which is referenced in the published Income and expenditure account and balance sheet”.
The audit by Deloitte was initiated by Sports Ireland (an amalgamation of the Irish Sports Council and a number of other bodies) in February of last year, at the behest of the Public Accounts Committee, which had received correspondence from Thomas Duggan of Millstreet.
Among the complaints were that delays occurred in HSI making grant allocations to Millstreet due to a pending mediation process between ShowjumpingIreland and Millstreet which is related to an ongoing commercial dispute between Showjumping Ireland and Millstreet.
In recent years, as a result of this dispute, Millstreet has staged a number of very successful unaffiliated shows.
Considering that the issue of unaffiliated shows were a hugely controversial and divisive issue in Irish show jumping, it is important to note that the Deloitte report said “the HSI board has yet to fully resolve how unsanctioned, unauthorised or unaffiliated equestrian events should be handled and managed in the long-run interest and development of the sport in Ireland”, adding that the HSI finance committee had “alerted the audit team to the importance of this matter as a key business issue for the sport horse industry in Ireland”.
The auditors also said “there is a risk that the presence of a senior RDS representative on the HSI board could create in the mind of an individual or stakeholder a perception of the exercise of influence, either directly or indirectly, over HSl ‘s governance and the manner in which HSI financial supports are operated and disbursed by HSI”.
It suggests that a review of HSI’s memorandum and articles of association should be carried out.
Of importance is the Deloitte finding in relation to Reaching New Heights, the 10-year strategy for the sport horse industry launched with such fanfare last year by former agriculture minister Simon Coveney. The report says that “funding of all the recommendations and initiatives included in the Industry Strategy Committee Report present a big challenge to HSI and the sport horse industry. HSI has commenced the process of distilling the individual recommendations into possible HSI actions”. An Implementation Committee will develop an annual business plan, with this and on-going monitoring reports submitted to the Minister for Agriculture. Importantly, the business plan and reports will also be put into the public domain to ensure full accountability.
However, the audit points out that HSI’s “financial resources of approximately €5.7m per annum have been under significant pressure in recent years and fall short of the €7.5m as was envisaged in the 2006 Dowling Report for the efficient and effective operation of HSI”.
As such, it noted, “there is a significant risk that HSI does not have the administrative and financial capacity or wherewithal to lead and deliver on the recommendations” in Reaching New Heights.
pointed out that the Government is proposing to do a review of the structure of Horse Sport Ireland and its affiliates, which it described as “appropriate”.
Another aspect of the audit was the incorporation of a confidential questionnaire for board members and senior executives. The primary purpose was to identify areas for improvement to assist the organisation in its governance and administrative control processes. Deloitte said the “areas for improvement may possibly stimulate further debate on important issues for the company and the industry”. It highlighted fundamental issues facing the sport horse industry and included among its suggestions:
The need to address “the conundrum/hard question in relation to the award of grants to non-affiliated bodies who organise international and other competitions;
Can an affiliated body organise a non-affiliated event?;
* Should a federation such as HSI discriminate in favour of affiliated events;
Should the Sport Ireland anti-doping controls be applied in a clearly evidenced manner to unsanctioned events organised by privately owned equestrian centres?;
That HSI appoint a director of sport;
That there be reduced representation from the Irish Horse Board, ShowjumpingIrleand, and Eventing Ireland and on the HSI board;
That there should be further investment in IT.
Meanwhile, a meeting for those interested in participating in the equine knowledge transfer discussion groups will take place at Silver Springs Hotel, Cork, next Tuesday, starting at 7pm.
Róisín Shanahan is the “facilitator” for the region.
due to the cancellation of Midleton Show, the Cork/Kerry Branch are running a show at Maryville Equestrian Centre next Sunday, starting at 9am.
There will be three arenas in operation. The feature class is the Munster Region GP and a 1.20mtr FBD qualifier.
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