University of Limerick will record a deficit of €700,000 in its accounts for the last financial year, despite having anticipated a year-end surplus of €7.5 million, staff at the college have been told.
The deficit is the result of what are now recognised as significant overspends by the college in two property deals in recent years.
The overspends have created shortfalls in the college’s accounts for last year of the order of €5.2m related to the purchase of homes on a housing estate at nearby Rhebogue and €3m linked to the purchase several years ago of the former Dunnes Stores site in Limerick city centre.
In an email, UL’s Deputy President told staff that the two impairments have impacted on UL’s year end accounts and will result in a deficit of €0.7 million.
“Prior to the inclusion of the impairments for the city centre campus and the Rhebogue developments” Professor Shane Kilcommins told staff, “the University anticipated a year end surplus of €7.5 million”.
A delegation from the Higher Education Authority is due to attend UL later this month – 23 to 25 April.
This follows a decision by the HEA last week to invoke a little used legislative provision to begin a special review of the purchase by UL of the Rhebogue properties.
The delegation will meet with the college’s “full Executive Committee” Prof Kilcommins informed staff, “and then meet individual members holding responsibility for particular portfolios – finance, governance, etc”.
UL President Professor Kerstin Mey is Chair of the Executive Committee.
She took sick leave last week as the college became further embroiled in the deepening controversy and concern over the purchase of the Rhebogue properties.
In his email Prof Kilcommins told staff that there would have to be accountability for the substantial impairment in UL’s financial accounts and he warned of difficult weeks and months ahead.
He said the college was engaging with the Public Accounts Committee regarding a hearing date.
“We intend to make it clear to the PAC that we will make ourselves available and that we will be utterly candid in our engagements with their questions,” he said.
The PAC was due to hear from Prof Mey on 11 April, however last week she sent notice that she would be unable to attend due to being incapacitated.
Also last week UL Chancellor Professor Brigid Laffan told staff that the college was entering a period of “extreme oversight” by the HEA.
