Kingspan has denied allegations that it hid a £4.2 million fine from its shareholders. The fine was part of a settlement agreed by Kingsapn following legal action taken by the Insurance Company of Ireland and the former Department of Commerce over unpaid export credit insurance payments. Contrary to Sunday newspaper reports, the fine was paid personally by brothers Mr Eugene Murtagh, chairman of Kingspan, and Mr Brendan Murtagh, then deputy chairman, according to a statement from the company.

The statement added that the settlement was done in such a way that there could not be any recourse to the Kingspan group. However, there was a contingency note on the 1994 accounts. According to a spokesman, this was taken away after a bank guarantee was put in its place.

The Stock Exchange is likely to look into the affair to see if there are any issues of lapsed standards on accountancy disclosure.

Following a newspaper report that the details of the settlement between Kingspan and the Government had been kept secret, the company insisted that the fine was settled personally by the two brothers and not with company funds. "No Kingspan funds were paid out in discharge of this ICI settlement," the statement said.

The 1993 settlement followed the collapse of a Canadian dairy business with which Kingspan had been involved. Export credit insurance had been set up on the back of a proposed dairy farm in Canada which never got off the ground. The loans were defaulted on and the Government and the Insurance Company of Ireland put the company into receivership.

Under the terms of the settlement, Kingcourt, a former Kingspan subsidiary had to pay £4.2 million, in annual payments of over £500,000. The last payments was made only last year.

According to Kingspan, the insurance was only arranged after ICI was satisfied that a milk quota was in place in Canada. However, there were allegations that this understanding was the result of a falsification of a letter which gave the impression that there was a milk quota by the Canadian company.

This quota had an estimated value between CDN$5 million to CDN$6 million and a guaranteed income flow to meet all the projects financial commitments.

There was detailed report in the Comptroller and Auditor Generals' report in 1990 but Kingspan was not named.