The Cyprus Olympic Committee’s (COE) extravagance several years ago may have belatedly landed it in hot water with the auditor-general’s office.
After a back-and-forth lasting some 10 months, the COE has reluctantly turned its books over to the auditor-general, for the first time.
The COE is a private-law entity and normally does not come under the purview of the auditor-general. However, unlike other sports federations (except for the Cyprus Sports Organisation, which is a semi-governmental organisation) a large chunk of the COE’s revenues come directly from the state via annual grants.
The state funding gives the auditor-general the right to scrutinize the COE’s accounts.
The reason the auditor-general is interested in the COE’s books dates back to its hosting of the 2009 Games of Small States of Europe, a biennial, multi-sport event.
According to Politis, the COE had initially budgeted some €1.2 million for organising the games. However, a few months before the sporting event, and following the election of Ouranios Ioannides as new COE chairman, the games budget soared to €3.8 million.
The daily reported for example that, under Ioannides’ watch, the budget allocated to renting limos for officials and VIPs went up by a factor of seven.
The problem for the COE was that, despite this profligacy, it later reported a €600,000 deficit for hosting the games, and asked the finance ministry to top up its account.
The ministry replied it would consider the request, but on condition that the COE made its financial statements available to the auditor-general. The COE did not comply.
Due to stricter budget regulations coming into effect in 2014, current Auditor-general Odysseas Michaelides took up the matter, requesting the COE to hand over its books.
In July 2015, at a meeting between the auditor-general’s office and the COE administrator, the latter agreed to submit its financial statements.
But 10 months later, the COE had still not complied. In the meantime, the COE had sought and obtained a legal opinion from a private law firm that stated the COE was not obliged to reveal its accounts to the auditor-general.
In a letter addressed to the COE dated this May 11, Michaelides reminded the COE of its obligation, citing the relevant clause in the 2016 education ministry budget – which carries the force of law – stating that “no grants can be given to the COE without the submission of financial statements to the auditor-general, for any years requested.”
In the same letter, Michaelides informed the COE that an inspection would be taking place soon.
On May 17, officials from the auditor-general’s office visited the COE’s premises, demanding the organisation’s financial statements.
According to Politis, a member of the COE council confronted the officials, telling them they had no right.
The officials in turn warned that refusal to cooperate was a criminal offence, at which point the CEO council member backed down.
It’s understood that the auditor-general’s office is now scrutinising the COE’s books dating back to 2006.
For the time being, the auditor-general is looking into possible waste of public funds, although the ongoing investigation could lead into other directions.