Latest: Epic has this morning released a statement saying: "We agree with the findings in the report and take responsibility for the issues raised. We have been working closely with Tusla since March 2017 to take action on their recommendations.

"We employed a fully qualified financial accountant to ensure our funds are accounted for in a robust and transparent way."

The charity said that since March 2017 it has worked closely with Tusla to address the recommendations provided in the audit.

The process is nearing completion, according to Epic.

Epic said: "During the period of the audit the organisation was under-resourced in back-office support functions and in particular finance. We’ve upgraded our accounting software to a more comprehensive system.

"A new management team and CEO are in place since this initial investigation and new policies are now in place to ensure compliance with all audit recommendations in the future."

Earlier: A Tusla-funded charity with 23 staff had no monthly payroll reports despite spending almost 81% of its income on payroll over three years.

The detail emerged following the release, on foot of a Freedom of Information request, of audit reports conducted by HSE Internal Audit Operations for Tusla.

The charity, Epic, which works with young people in care, received €1.9m from Tusla between 2014 and 2016.

The audit also found that its credit cards were used to buy gift vouchers for employees, and alcohol purchases were claimed on its expenses system.

An audit of a school completion project funded by Tusla found that it overstated expenditure over two years by almost €50,000 and overstated wages by more than €39,000.

And a counselling centre, also in receipt of Tusla funding, had no dual authorisation for its online banking system which meant administrative staff could process invoice payments without approval, an audit found.

Each audit contains a raft of recommendations for each of the organisations and Tusla said it is monitoring them all to ensure full and timely implementation.

Alcohol purchases claimed on charity’s expense system

A charity’s credit cards were used to buy gift vouchers for employees while alcohol purchases were claimed on its expenses system.

An internal audit of Empowering People in Care (Epic), a national organisation with charitable status that works with and for children and young people living in care, identified these and other areas of governance and financial concerns.

Between 2014 and 2016, Epic, with a staff of 23, had income totalling €3.2m, with €1.9m or 59% coming from the child and family agency Tusla.

Its expenditure for the same period totalled €3.2m, of which €2.6m, or 81%, was staff costs.

An audit, completed for Tusla by HSE Internal Audit Operations, found that there were no monthly payroll reports, expense claims were incomplete and unsigned, and purchases of alcohol were claimed.

There were no credit card expenditure reports available for the period audited and testing of credit card transactions found that itemised receipts were not always attached, statements were not always signed, and cards had been used to buy gift vouchers for employees and for cash withdrawals.

It found the charity was not compliant with the governance code for community, voluntary, and charitable organisations in Ireland; that board members had not signed the Ethics in Public Office statements; and that the conflicts of interest register was incomplete and not up to date.

It also found there had been no tendering for accountants for more than eight years, and there were restatements of figures in the 2015 accounts without the required accompanying disclosure.

The findings and recommendations were sent to Epic last May and it has accepted the report.

An audit of the Jobstown School Completion Project, which got some €505,000 in Tusla funding in 2017, found inaccuracies in the financial returns submitted to Tusla for 2015 and 2016, including an overstatement of expenditure totalling almost €50,000, an overstatement of wages of just over €39,000, and issues with its travel and subsistence claims.

Management pledged to address many of the issues highlighted by June last year, while the implementation of other recommendations is ongoing.

An audit of Hesed House Counselling Centre, which gets €45,000 in Tusla funding, found there was no dual authorisation for its online banking system, and that administrative staff did not require a second approval on invoices before processing payment.