A Comptroller and Auditor General report has identified serious procedural deficiencies in financial controls and governance at FÁS.
Read the CA&G report on FÁS
Controversy over expenses and lax financial controls led last year to the departure of its former chief executive Rody Molloy and former chairman Peter McLoone and the appointment of a new board earlier this year.
The CA&G report examined transactions carried out at FÁS Head Office and governance arrangements for the organisation.
It also reviewed the management of the Competency Development Programme and the administration of foreign travel and business expenses.
It found that control failures exposed FÁS to the risk of losses as well as the risk of failing to achieve best value for money.
It said FÁS had a plan of control that was adequate but it 'did not always operate effectively and as intended. '
- Authorisation limits were breached when certain transactions were being initiated
- There were deficiencies in the conduct of tender processes when goods and services were being acquired
- Payments were made in the absence of supporting documentation
- Confirmation orders for purchases already effected were issued in many instances
- The system of risk management adopted by the Board in 2005 did not function effectively.
- Around €1m of the €3m worth of flights between 2002 and 2008 were booked outside FÁS's internal procedures.
The report found that key units failed to detect or react appropriately to non-compliance with internal procedures.
However the Comptroller and Auditor General stressed that FÁS had begun taking steps to address some of the control deficiencies identified.
The report said that FÁS incurred around €3m on flight costs from 2002 to 2008.
Prior to 2009, when the Board adopted a set of foreign travel procedures, FÁS did not have a written foreign travel policy although it had notified staff of procedures to be followed when booking flights.
Around one-third of flights in the period under review were booked outside those FÁS internal procedures, the CA&G found.
A comparison of the class of travel used by FÁS with that used by 20 other public sector bodies found that FÁS used business class for a lower proportion of long-haul flights but for a higher proportion of short-haul flights than the other organisations.
Over one-quarter of all flight costs were incurred on the Science Challenge Programme - over €200,000 of this was for travel by non-FÁS personnel.
Some of the costs incurred for non-FÁS personnel were for Ministers or civil servants who were involved in promoting FÁS programmes.
The report calls for a 'comprehensive review' of its system of controls and clearer guidelines on foreign travel, and business expenses.
The report says any costs linked to travel by Ministers of civil servants should be borne by the relevant Government department.
The examination is a follow up to two special reports issued in April 2008 and June 2009, which were later considered by the Committee of Public Accounts.