Apple escrow account incurred operating costs of €6m

The escrow account holding the Apple tax funds incurred operating costs of €6m last year.

According to the Comptroller and Auditor General's (C&AG) Report On The Accounts of The Public Services for 2023, the costs primarily related to fees for investment managers' and escrow agents.

The €6m costs figure is roughly the same as it was in 2022.

The report also details how the value of the assets in the fund rose by €400m last year to reach €13.774 billion.

That was the first year a gain on the money was recorded since it was placed in the account by Apple in 2018.

"The increase in the value of the fund over the year was due to the higher interest rate environment, with the increased income and cash flows mainly due to holding and reinvesting in assets at higher yields," said the C&AG.

Originally, Apple placed €14.3 billion in the account following the European Commission's 2016 tax ruling which concluded that Ireland had given illegal State aid to Apple.

That figure, arrived at by Revenue, was made up of €13.1 billion in unpaid tax plus interest of €1.2 billion.

In a final ruling earlier this month, the European Court of Justice directed that Apple must pay the money to Ireland, following a series of appeals.

The objective of the investment policy for the Apple escrow account was to preserve the capital value of the fund to the greatest extent possible in light of the prevailing market conditions, the C&AG said.

"The agreed risk appetite in respect of the escrow fund is 'low', with investments permitted only in securities that have a low degree of inherent risk, such as highly-rated fixed-income securities of short to medium-term duration," the report stated.

It says the fund is exposed to a variety of market, liquidity and credit risks.

"In line with the investment policy, the escrow fund is invested in highly rated eurodenominated fixed income securities, or held as cash and cash equivalents," the report said.

At the end of last year, of the €13.7 billion held in the escrow, 45% was invested in financial assets and 55% was in cash and cash equivalents.

"This represents a significant change from the end of 2022, when 82% of the total assets were invested in financial assets and 18% in cash and cash equivalents," the report said.

"The increased investment in short-term securities was in anticipation of the Court of Justice’s final judgement on the case," it added.

The Government has said it expects that Apple money to be transferred to the exchequer in two tranches - one this year and another next year - although for accounting purposes it will all be booked this year.