The outgoing Executive Director of the Gay and Lesbian Equality Network (Glen) has said a number of irregularities became apparent to her with regard to the organisation's governance and financial management shortly after she joined last October.
Speaking on RTÉ's Morning Ireland, Áine Duggan said a number of Glen's financial transactions, many of which were in excess of €60,000, had not been reported in the management accounts, meaning the board was not aware of them.
She said this included spending on a political campaign and there was "clearly an indication of spending on credit cards".
"In some instances you can definitely see that people got into a habit of doing things without necessarily thinking about it, and that was all behaviour that needed to be corrected."
Ms Duggan said she felt it was "very important" to bring this to the attention of the board of Glen, which she did over a series of meetings last November and December.
She then recommended that a series of corrective measures be implemented, including putting new accountants in place and reporting the concerns to the Charities Regulator.
She said: "The context here was there was nobody with any financial expertise reviewing the books and we didn't have qualified accountants preparing the books".
Ms Duggan said the initial reaction of the regulator was that it also had concerns over the financial mismanagement of Glen and "wanted to assert if indeed there was financial misappropriation".
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She also recommended bringing in independent financial consultants and changing auditors - steps that the charity is enacting.
The Charities Regulator has directed Glen to provide specific information including financial reports, details of staff credit cards and the report of an independent auditor.
The direction stretches back three years to 2014.
The Health Service Executive has also withheld some grants and has said it is in communication with Glen about 2017 funding.
Ms Duggan said there are records of some of the money being reimbursed to Glen, although the funds do not show in the organisation's management accounts, but do show in another side account, known as a debtors' page.
She added that the use of these financial transactions off the books predates her tenure and goes back a decade.
Ms Duggan added: "I would like to be able to stand up and say I can absolutely 100% stand over a statement that there was no misappropriation. Unfortunately I can't do that. Nobody can and that's why the audit is so important."
In a statement yesterday, Glen said it is satisfied that all grants received have been used for the intended purpose and it has no reason to suspect there has been any misappropriation of funds.
The charity added it had put in place new financial procedures to enhance its administrative systems, including the appointment of specialist accountants.
Glen said it was fully cooperating with the regulator.