The wife of one of the directors of Bovale Developments cannot account for cheques totalling £100,000. Ms Caroline Bailey, who is married to Mr Tom Bailey, and who played a major role in the company's day-to-day book-keeping, told the tribunal she thought two cheques made out for £50,000 in September 1990 ended up in the couple's sheep farm account in the AIB branch in Navan, Co Meath. She said she did not know why they would be attributed in Bovale's accounts to Smith Foy solicitors.
The first cheque for £50,000 was made out to AIB Ltd on September 7th, 1990, while the second was made out to cash on September 30th of that year.
Counsel for the tribunal, Mr Desmond O'Neill SC, said investigations so far had not been able to establish that the first cheque went into the farm account.
Ms Bailey also told the tribunal that financial records for several years were destroyed when a metal container was maliciously burned out in July 1997.
She was involved in keeping the financial records of Bovale since 1982, shortly after she married Mr Tom Bailey. After the company grew, she was assisted by a number of other employees, who Mr Justice Flood ruled yesterday would only be referred to by their initials.
Before working for Bovale, Ms Bailey had worked as a bank clerk at various branches of the Bank of Ireland. Her training was not in book-keeping but in secretarial skills. After marrying Mr Bailey, she said, she "just helped Tom write up the invoices and do the general day-to-day accounting for the company".
The "day-to day books" kept by Ms Bailey and the other employees would be sent to the accountants at the end of the financial year.
She often prepared cheques to be signed by both of the Bailey brothers and made them out in her own handwriting. The Baileys also carried cheque books on their person, and it would not be unusual for 10 cheques in a 50-cheque book to be blank when Ms Bailey had to complete the cheque journal and the bank reconciliation. She would fill in the gaps by referring to the bank statements, or by asking the bank for a copy of the cheque for the accountants.
Accounting records would be kept either at a site office or in a steel container used for storing building materials, which would be moved from site to site.
However, Bovale lost records for several years in 1997 when a steel container was set on fire at a site in Mygan Park in Finglas, Dublin.
???????????i but Ms Bailey was not aware that anyone had been arrested or charged in relation to the incident. The container, which was insured, was a "complete mess" after the incident, Ms Bailey said.
Ms Bailey said she was never a director of the company, but was paid wages. The Bailey brothers were also paid a wage, but never received a salary as directors, she said. However, she did not know whether they were paid a bonus.
She said it was only "on a rare occasion" that cheques for tens of thousands of pounds were made out to herself and her husband, or to Michael Bailey.
Asked to explain why such cheques would be made out, Ms Bailey said: "That was their decision as directors. I never queried or argued about why they paid a cheque to anybody."
She would merely record to whom the cheque was made payable and let the accountants and the directors decide how they would describe the cheques in the accounts.
Asked why the £50,000 cheque made out to AIB in September 1990 was not made out to Tom Bailey if it were intended for his account, Ms Bailey said: "I do not know. On the day I just made it out to AIB . . . I do not think it is in any way odd that it is made out to AIB."
However, she agreed with Mr O'Neill that it was "somewhat unusual that a director of a company would sign cheques which in effect were going to end up in his own personal account".
The other cheque for £50,000 to cash was not made out in her handwriting but she imagined "it had something to do with the sheep-farming".
