The Charities Regulator is looking at using technology to "risk profile" the organisations it regulates.
It is looking at whether it could use a system that would spot “risk indicators” in the information filed by charities, which would prompt the regulator’s compliance department to focus on a particular charity.
The regulator will receive financial accounts from all the charities registered with it, or have access to accounts filed with the Companies Registration Office by incorporated charities registered with it, but with the number of charities likely to be in excess of 13,000, deciding what ones to focus on will be a key challenge.
The regulator was established in 2014 on foot of legislation passed in 2009, and the full suite of powers envisaged for the regulator is being introduced on a phased basis.
Commencement order
In the wake of the Console controversy, the Tánaiste and Minister for Justice and Equality,
Frances Fitzgerald
, has said she will sign a commencement order in the next few weeks that will provide for the regulator’s compliance and enforcement roles to come into effect.
The move will mean powers that were not due to come into effect until next year will come into effect this September.
The regulator is investigating whether technology could be used to identify such matters as a spike, or collapse, in income, payments to directors, a fall-off in reserves, or frequent changes in directors, in the fillings made by charities, so that staff in the compliance department would be prompted to do a closer examination.
Technology
The use of risk intelligence technology would complement information gleaned from complaints from the public, and other sources of information, to guide the work of the compliance department.
The delay in establishing the regulator since 2009, was because of the strain on the public finances. The regulator currently has 23 staff and plans to have 36 by year’s end. As there is little experience in the jurisdiction of charities regulation, it is expected that it will take some time for the organisation to learn how best to operate.
The section of the legislation to be commenced by the Tánaiste gives the regulator the right to appoint inspectors who can investigate particular charities, demand to see books of account and other records, demand interviews with directors and executives and, with the consent of a District Court judge, raid a premises.
The regulator’s initial priority when established was the compilation of the statutory register of charities with a view to underpinning and supporting the investigatory and enforcement functions at a later stage.
The Tánaiste’s department has pointed out that the regulator has no role in investigating fraud or competence to carry out such investigations, but that it can and has worked closely with other agencies.
The regulator is to begin a public consultation process in relation to draft charity accounting and reporting regulations, which will provide for fuller implementation of the law governing the statutory requirements for the annual statement of accounts by charitable organisations, the examination or audit of such accounts, and the preparation of annual reports.
