What happened to the Northern Ireland Events Company (NIEC)?
The Chief Executive of NIEC resigned in May 2007. In September 2007, the Acting Chief Executive notified the Department of Culture, Arts and Leisure (DCAL), its sponsor Department, that NIEC had accumulated an estimated £1.2m financial deficit. Investigation found that deficit of £1.3m could be attributed to overspending on events promoted by NIEC between 2005 and 2007, mostly Motocross and Supermoto events. The total costs of NIEC’s deficit was in the region of £1.6m (including administration costs relating to the winding up of NIEC), and that cost ultimately fell on the taxpayer. The Public Accounts Committee found failures on the part of:
- The Chief Executive of NIEC, for not ensuring that public funds were properly managed and safeguarded
- The Board of NIEC (all public appointments), for not providing effective leadership, direction, support and guidance
- DCAL, for not fully discharging its responsibilities in terms of sponsorship
The Company Inspection required took over 5 years and cost £1.24m.
The report can be found NI Assembly report can be found here.
Some Key Learning Points –
If you’re a Board member (whether in the private, public or charity sector) make sure you:
- Appoint a Chief Executive that is capable of the role, and oversee their performance closely.
- Ensure that the Board gets very clear reports, in a standard format, on performance against agreed plans (including financial). Finance reports to the Board should include current position (budget, actual, variance) and predicted year end position. There should also be a Cash Flow Forecast, to enable any coming difficulties to be identified and dealt with.
- Ensure that risks are identified and managed at all levels, including ‘clean sheet’ Board thinking about key risks at least annually, and clear reports on risk to Board meetings.
- Ensure that proportionate internal audit processes are in place, to check that internal controls are working.
Some useful reading –
- How to Lead: Wisdom from the World’s Greatest CEOs, Founders, and Game Changers (Free with Audible free trial)
- The New Directors Handbook: How to become more confident, more effective, more quickly
- Risk Management for Company Executives
- Fundamentals of Enterprise Risk Management: How Top Companies Assess Risk, Manage Exposure, and Seize Opportunity
