Swimming: No CEO, huge legal costs, grants unaccounted for, no plan to protect children. Johnny Watterson on a damning study

Even in the careful language of accountancy a recent report on the governance of Swim Ireland (SI) is savagely critical of the organisation and how it has been run.

According to the report of an internal audit by Deloitte & Touch, seen by The Irish Times, SI's liabilities exceed its assets and it is running the risk of becoming insolvent. A huge proportion of its income is absorbed in legal fees and insurance costs and the situation is not likely to improve in the near future.

The Irish Sports Council (ISC) has already stopped its funding to the governing body of swimming pending wholesale changes in the way it is structured, funded and administrated.

The report states that "major risks permeate Swim Ireland's operation" and that an enormous source of concern is "the plethora of legal cases coming before the courts shortly".

The civil cases, which include those being taken by victims of the jailed child abuser, former Irish Olympic coach Derry O'Rourke, "range from reputational damage to the unknown cost outcomes".

Following the January 1998 conviction of O'Rourke for a number of sex abuse offences against 11 young female swimmers between 1976 and 1992, the Government suspended funding for the then Irish Amateur Swimming Association (IASA) and announced an inquiry into its handling of allegations against O'Rourke and another Olympic coach, George Gibney. That inquiry, according to the then Minister for Sport, Jim McDaid, "showed a total systems failure within the IASA".

More than a dozen individuals are taking cases against the IASA, the governing body before SI was constituted. These cases are likely to be heard in the High Court in the next six months, and costs here for discovery alone are estimated at €125,000.

Swim Ireland is also haemorrhaging funds on another front. The failure to appoint a chief executive officer (CEO), resulting from a de-ratification process, has become a significant financial drain. Costs, excluding legal fees, of €65,000 have already accrued to date resulting from the non-appointment. The report stays this process of ratifying, then de-ratifying a CEO "has been an expensive debacle", and it is not even known what further costs will arise.

Arising from ISC concern about the CEO dispute, experienced management consultants were brought in to assist SI. Yet that too was a waste of money as "Swim Ireland was not properly geared up or in a position to respond proactively or meaningfully" to the consultants.

In all, Deloitte & Touche makes 19 recommendations for change, which range from the unwieldy size of the current board to the "conflict and tiresome debate" which is rooted in "provincialism or provincial ties".

It points out that the board of SI, with 19 members, is double the size of the boards in comparable national governing bodies (NGBs), while those same NGBs have almost three times the number of staff as SI.

In an extraordinary finding, the report points out that the ISC, which provides the bulk of the funding for the organisation, could have a claim against SI for €34,000 in respect of a contribution by it under the "Learn to Swim" programme. The conclusion drawn is that the money may have been used for other purposes.

It further points out that it is impossible to validate whether SI has delivered on certain objectives funded by the ISC because funds received are not earmarked or placed in designated bank accounts. As a result, the ISC cannot know whether the money has been used solely for the specific purposes intended and agreed.

"In other words," says the report, "the audit trail is poor."

It candidly recommends that the board of Swim Ireland needs to "satisfy itself that it is not conducting its business recklessly".

But as shocking as the dire financial situation of Swim Ireland and its inability to govern itself is the inactivity surrounding the implementation of recommendations contained in the Murphy Report. This was delivered by the then Senior Council, Roderick Murphy, following the sexual abuse scandals and was seen as a blueprint for correct governance, with a particular emphasis on the protection of children.

Deloitte & Touche has concluded that SI, an organisation with 12,000 members, most of them minors, "does not proactively operate a transparent tracking process and reporting mechanism whereby it monitors the implementation of recommendations contained in the Murphy Report".

It goes on. The memorandum and articles of association were pushed through "with haste", and need to be reviewed. The rotation of officers was not "orderly or consistent with effective governance".

The six-month review, regarded by the ISC as "important for accountability", has not been submitted.

The goals and objectives set out in April 2002 as outlined in the development plan "has been most disappointing".

An irregularity in board minutes has been unearthed pertaining to the costly CEO situation.

The conclusions drawn from the result of the audit are a severe blow to the organisation, which, not unlike many other sports bodies in Ireland, is largely dependent on the ethos of amateurism and volunteerism.

It is also a counterpoint to the one glimmer of light that illuminated the sport last month in the European Short Course Championships at the National Aquatic Centre, where Irish swimmer Andrew Bree won a breaststroke silver medal, the first since Gary O'Toole in Bonn in 1989.

Before Bree's achievement, swimming headlines have been dominated by the depressing controversies surrounding coaches O'Rourke and Gibney. Then, following the Atlanta Olympic Games of 1996, the sport erupted with allegations of cheating against triple Olympic gold medallist Michelle de Bruin, culminating in a doping offence which was to finally finish her swimming career.

Having started all over again from the discredited IASA in the 1990s, it seems now that the infant SI will have to do it all again.

Main Findings

• Current liabilities exceed current assets

• Financial situation likely to get worse

• Significant legal risks permeate SI's operations

• Articles of association need to be reviewed

• No coherent strategic plan

• Massive civil litigation pending

• Board members are well-meaning amateurs

• Failure to properly exploit hours in National Aquatic Centre

• Codes of conduct for conflict of interest not developed

• Sectional and provincial interests unduly influence policy

• Failure to implement recommendations of Murphy report into child abuse