Investigation shows that there have been ‘improper transfers’ of money at Peter McVerry Trust

In addition to many concerns, it was also noted that “donor intent” was not met when using limited resources.

Madeleine Delaney, chief executive of Charities Regulator, said: “Charity trustees must also ensure systems and processes are in place to ensure they get the information they need to oversee all the charity’s activities.

“This allows them to make fully informed decisions about the charity’s governance, finances and other important matters. The report highlights the damaging consequences for a charity if this does not happen, which can impact on public trust in the wider charity sector.

“Charity trustees have a duty to ensure that donations, funds or grants given for a specific charitable purpose are used only for that purpose, and are used appropriately and responsibly.”

In one case, the charity was found to have used €1 million in funding it received from a religious order to pay its creditors, even though the order had donated money for a specific purpose, with the funds intended to be put to this use be limited.

It also found “material inaccuracies” in the recording of the charity’s assets and inadequate management accounts that failed to disclose the level of debtors, creditors or debt financing.

In addition, inspectors found no evidence of active management of conflicts of interest and that public procurement procedures for services and contracts to ensure value for money were not implemented or adhered to.

The report states: “The inspectors identified numerous cases of improper transfers and commingling of funds between restricted and unrestricted funds, as well as the unauthorized use of restricted funds for operational purposes.

“This demonstrates a lack of financial oversight and consideration of donor intentions by the Board of Directors as to how limited resources should have been used.”

The Charities Regulator said it will be contacting the board to ensure the issues raised by the inspectors are addressed appropriately.

Last year the government agreed to provide a €15 million rescue package to the charity as it faced serious cash flow problems, on the condition of reforms to the organisation.

The Charities Regulator and the Approved Housing Bodies Regulatory Authority have both appointed inspectors to carry out separate investigations into financial and governance matters at the trust.

The Peter McVerry Trust appointed a new CEO earlier this year, when Niall Mulligan took over after previous CEO Francis Doherty resigned in October after just over four months in the role. The charity has been asked for comment.