Treacy delivers gloomy update on FAI finances

Sport Ireland CEO John Treacy has laid bare the perilous financial state of the FAI with a series of troubling revelations, the most stark of which is that they are currently in discussions with Uefa about a bailout package that would ensure they can operate for the next 12 months.

Treacy delivers gloomy update on FAI finances

Sport Ireland CEO John Treacy has laid bare the perilous financial state of the FAI with a series of troubling revelations, the most stark of which is that they are currently in discussions with Uefa about a bailout package that would ensure they can operate for the next 12 months.

Treacy was unable to confirm whether the FAI is currently solvent, confirming only that they were being funded by European football’s governing body and a deal for the next year had yet to be finalised.

In a worrying exchange with Senator Pádraig Ó Céidigh at an Oireachtas Sports Committee meeting yesterday, Treacy also reiterated that the FAI have “some big jumps to get over before there is a restoration [of funding]” from Sport Ireland, and that they were “digging into future funding” from Uefa in a bid to avoid liquidation.

Sport Ireland chairman Kieran Mulvey also insisted that the next tranche of funding, due to the FAI in September, will be withheld until they receive reports from the association’s auditors, Deloitte, the firm KOSI which Sport Ireland also appointed as independent auditors, and the Office of Corporate Enforcement.

Sport Ireland backed Minister for Sport Shane Ross’ calls demanding that Donal Conway reject his nomination for FAI president at the upcoming AGM in Meath, citing a complete clearout of the current FAI board as one of their conditions of restoring funding.

However, it was the revelations from Treacy regarding the ongoing talks between the FAI and Uefa which have provided fresh cause for concern about the future of the embattled organisation.

“We gave them their first tranche [of funding] in, it might have been February or March of this year,” Treacy said. “They will be due again in September. They’re being funded by Uefa, as we understand. They’re not knocking down our door, but they know they have some big jumps to get over before there is a restoration [of funding].”

Senator Ó Céidigh then enquired as to whether the FAI were “digging into future funding to keep going”, with Treacy replying: “I would imagine they’re digging into future funding.”

Ó Céidigh added: “So they’re borrowing money, in effect, from Uefa that they would have to pay back? That could cause going concern?”

“It could,” Treacy replied.

That’s the really important question that KOSI will be considering as well, as part of their audit. I think they’re probably trying to assess what the going concerns are and what likely liabilities or risks the organisation will have in the next six to 12 months.

“I would hope that would Uefa or Fifa would bail them out. I would hope that that would be the case. It’s not in anyone’s interest that a national body would go under,” Treacy added.

“I know that the FAI have been talking to Uefa about a financial package. I don’t believe it is finalised yet, but a financial package would see them through the next year or so.”

Fergus O’Dowd, chairman of the Oireachtas Committee in question, later pressed Sport Ireland on “what would happen if there was an insolvency [of the FAI], what role, if any, would you have in that?”

It was at this point that Mulvey added: “At the end of the day, it comes down to the law — there are bodies there for regulatory purposes. However, in the KOSI audit, in their terms of reference, what are the risks going forward?

“We have asked them to evaluate these risks for us because we are aware, as John [Treacy] has indicated, that the FAI have received either a letter of comfort or forward grant funding from Uefa/Fifa in the context of other monies that are due to the FAI from broadcasting rights that arise from our international team.

“We have to wait and see what the external risks are,” Mulvey continued. “There are a myriad of risks there. At the moment, in regard to current funding and future funding, the State has made it very clear, the Minister (Shane Ross) has made it clear, and we have made it clear in regard to our funding, unless the stable is cleared, there will be no forward funding.

We are holding the last tranche of our grant, we are holding that until we are reassured that the FAI is governed appropriately and properly, that these reforms are accepted in their entirety and that a clean bill of health is given to them.

“We are awaiting what Deloitte will do on that, what comes out of the Office of Corporate Enforcement and KOSI.”

The FAI will hold an EGM in Meath on Friday, during which they will attempt to pass the necessary rule changes required to adopt the 73 recommendations put forward by a Governance Review Group.

The following weekend, FAI chairman Conway stands unopposed to be re-elected, something which Sport Ireland does not support.

The FAI were contacted for comment regarding Treacy’s revelations, but did not respond.

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