Mr. Conor O'Mahony:

I thank the director for that little hospital pass he gave me. While I am on the board of the Irish Auditing and Accounting Supervisory Authority, IAASA, I am not here in that capacity and I am not authorised by the board to answer these queries. I will give some very high level observations. Following the collapse of the banking sector, there were not just banking problems in Ireland but across the world. A significant debate at the time was whether the auditors had been asleep at the wheel or if the auditing standards had been up to scratch. There was intense debate on that around the world. Auditing standards were changed to try to address what happened in Enron some years earlier. When that revised standard was tested by what happened in the financial maelstrom of 2007 and 2008, there were strong arguments that the revised auditing standards were found wanting. The auditor certainly argued that they were required to give a pass to what was going on. It was quite unsatisfactory.

The standard has subsequently been changed dramatically. It was an incredibly complex area. IAASA required the Chartered Accountants Regulatory Board, CARB, to conduct reviews of all of the major, Irish-registered bank audits and required them to get an independent expert in from the UK. I think Mr. Drennan was involved in requiring that in his previous capacity and there was in-depth work on that. That ended up being delayed for a number of years because it could not be progressed while the Anglo-Irish investigations and criminal proceedings were ongoing. The whole thing was complex. I know that is not a very satisfying answer in that it does not attribute blame but these are complex areas. It goes back to what the director said, which is that auditors do a particular job but it is probably not the job that the man on the street expects them to do.