The Code of Practice for the Governance of State Bodies 2016, Business and Financial Reporting Requirements provides that “State bodies should disclose details of expenditure on external consultancy/adviser fees in their annual report and/or financial statements for each accounting year for each entity”.
The Code states that for the purpose of disclosure in financial statements/annual report, ‘consultancy fees’ means fees paid to external parties providing advisory services of any nature. The 2017 Guide to the Implications for the Annual Financial Statements and the Annual Report
defines consultancy as "where a person, organization or group thereof is engaged to provide intellectual or knowledge-based services (e.g. expert analysis and advice) through delivering reports, studies, assessments, recommendations, proposals, etc. that contribute to decision- or policy-making in a contracting authority". The engagement should be for a limited time period to carry out a specific finite task or set of tasks that involve expert skills or capabilities that would not normally be expected to reside within the contracting authority.
The Guide provides further clarity on the requirement to disclose consultancy costs and it is suggested that fees paid to external service providers should be categorised as Legal, Financial, PR/Marketing, HR and Pensions, Business Improvement and Other.
As set out on page 27 of the Guide to the Implications for the Annual Financial Statements and the Annual Report, consultancy costs include the cost of external advice to management and exclude outsourced ‘business as usual’ functions which do not fit within the definition of consultancy as outlined above.
The table below provides total spend in 2022 on consulting services and on ‘business-as-usual’ outsourcing, as provided by the commercial State bodies under the aegis of my Department.
Home Building Finance Ireland appoints Legal, Monitoring Surveyor and Valuation firms as part of the due diligence process on each of its loan transactions, with the costs being recovered from the relevant borrower. These costs have been excluded from the figures below.
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Consulting Services– Total Spend 2022
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‘Business-as- usual’ outsourcing – Total Spend 2022
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Home Building Finance Ireland
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€172,000
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€165,000
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National Asset Management Agency
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€281,000
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€12,724,000
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Strategic Banking Corporation of Ireland
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€240,151
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€445,127
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