Irish Horseracing Regulatory Board Publishes Findings of Forvis Mazars Review

The Curragh, 05 November 2024 – The Irish Horseracing Regulatory Board (IHRB) today published the findings of a Forvis Mazars review of financial governance within the organisation. The report is available here.

The firm was appointed by the IHRB and Horse Racing Ireland in August 2023 to carry out an independent review into historical financial transactions within the IHRB and to review its financial governance procedures after IHRB CEO, Darragh O’Loughlin, was made aware of a financial transaction that did not adhere to governance requirements. At the time, the matter was immediately brought to the attention of the relevant authorities, including the IHRB Board, the Department of Agriculture, Food & the Marine, Horse Racing Ireland and the Comptroller & Auditor General and it was disclosed to the Oireachtas Public Accounts Committee. The Charities Regulator was also notified.

The Forvis Mazars review involved scrutiny of six years’ worth of IHRB financial and other records, dating back to the organisation’s establishment at the beginning of 2018. Reassuringly, the review identified no additional transactions that were in breach of financial governance requirements other than that which prompted the initial concern, and there was no evidence of misappropriation for personal gain.

The IHRB recognises the importance of a robust governance structure, and a number of significant changes to enhance financial governance have already been implemented by the IHRB or are in progress. These specific measures, designed to address the recommendations, include:

• Strengthened financial controls, particularly regarding the authorisation and approval of online banking payments, with strict transaction approval limits and segregation of accounts access.
• Developing and enforcing comprehensive documentation and formal approval procedures for all material financial transactions.
• Strengthening and expanding the existing Service Level Agreement between IHRB and HRI to include provisions capturing the recommendations made to ensure compliance with governance and other requirements and enhanced transparency and reporting mechanisms in relation to the Integrity Services Budget.
• Putting in place formal written agreements and detailed procedures with all charities and non-profit entities receiving administrative support from the IHRB, setting out roles and responsibilities.
• Strengthened governance procedures in relation to the approval, funding and reporting of redundancy and/or retirement payments.
• Supporting the Trustees of the charities in their implementation of appropriate and effective charity governance policies and procedures.
• Recording and tracking our organisational compliance with the Code of Practice for the Governance of State Bodies.
• Closer collaboration with HRI and, where appropriate, the Department of Agriculture, Food and the Marine in relation to financial and governance matters.
• Increased operational collaboration with HRI on efficient delivery of shared objectives, including a joint IT strategy and an expanding shared services approach to key support functions such as HR and Procurement. This is already bringing gains in capacity, effectiveness and resilience, and eliminating key person dependencies.

Outlining the changes being implemented by the IHRB, CEO Darragh O’Loughlin said: “The IHRB is clear that the incident that gave rise to the Forvis Mazars review absolutely should not have happened. Since we commissioned this review, we have taken significant actions to improve our financial governance procedures and internal controls and we have publicly reported on this work to the Oireachtas Public Accounts Committee.  We will continue to address the issues highlighted in the review and further strengthen the organisation, and are on target to have fully implemented the recommendations by the end of the year.   

“The IHRB is currently engaged in an ambitious programme of modernisation and change, guided by the IHRB Strategy 2024-2027 which we published late last year. Governance is a key pillar of this strategy, which commits to consistently applying a robust governance framework and a rigorous probity regime. We have made significant strides in this direction, including amending our constitution to improve Board diversity and independence, and strengthening our Service Level Agreement with Horse Racing Ireland to ensure greater financial transparency and oversight of governance. Additionally, we are in the process of establishing formal agreements with the various charitable and non-profit entities for which we provide administrative support to clearly define the respective roles and responsibilities.

“Importantly, we have tightened our financial oversight and transaction approval controls to ensure that such an incident will not happen again.”

In conclusion, Chairperson John Byrne stated that “I firmly believe that effective corporate governance ensures our ongoing success as a diverse forward-thinking and adaptable organisation.  We are resolute in our commitment to making the necessary changes to uphold the highest standards of financial governance and to assure public trust in the IHRB as the regulator of Irish horseracing.”

ENDS.

Note to editors: There are a very small number of redactions in the report. These are to remove references to a particular charitable trust which was mistakenly captured in the Terms of Reference but which does not receive administrative support from the IHRB, and to mask personal financial data in respect of three individuals who would be identifiable by virtue of the reference to their dates of departure from the organisation.