Jan 11, Colombo: Sri Lanka's Central Bank said today that it will initiate measures to carry out forensic audits in relation to the issuance of Treasury bonds during the 2008 to 2014 and the Treasury bond auctions held in March 2016.
Issuing a statement, the Monetary Board of the Central Bank said on 10, January 2018 the Secretary to the President, handed over a copy of the report of the Commission of Inquiry to Investigate, Inquire and Report on the Issuance of Treasury Bonds (COI) during the period from 1st February 2015 to 31st March 2016 to Governor, Central Bank of Sri Lanka entrusting the task of considering giving effect to the recommendations contained in the Report.
The Central Bank said it has already implemented some of the recommendations in the report, while measures have already been initiated to implement most of the other recommendations. The Monetary Board has consulted the Attorney General, as appropriate, in the actions it has taken.
The Monetary Board says it considers it appropriate to keep the public informed of the status of actions and initiatives that have or are being taken on the recommendations made in the Report and to generally improve transparency in the management of public debt and the Employees Provident Fund. It added that the report is continuing to be studied and the Monetary Board will initiate further actions, as appropriate.
Measures have been taken to increase the efficiency and enhancing the transparency of debt management operations and a new Auction System for Primary Issuances of Government Securities and improve secondary market for Sri Lanka Development Bonds (SLDBs) have already been introduced.
Measures have also been taken to strengthen the internal controls and transparency of public debt operations and secondary market transactions in government securities and to improve Transparency and Governance of the Investment Decision Making Process as well as the internal control framework of the EPF as well as to enhance the credibility of the Investment Decision Making Process of EPF.
The Central Bank has also taken measures to strengthen the Internal Control Framework while regulatory actions have been taken on Perpetual Treasuries Limited and Pan Asia Banking Corporation PLC.
The statement said subsequent to the internal examinations and investigations conducted by the Central Bank and based on the findings of such examinations and investigations, disciplinary actions have been taken with respect to few members of staff in conformity with the
Classification, Control and Appeal Rules of the Manual of the Central Bank of Sri Lanka. Four officers are currently under interdiction.
The Central Bank has already drafted Codes of Conduct for members of the Monetary Board and the staff in general, and with specific codes of conduct for staff in the Employees Provident Fund (EPF) and the Public Debt Department (PDD). These will be given effect to, once approved by the Monetary Board.
The Monetary Board will assess the Internal Audit Function of the Central Bank with a view to further expanding its scope and strengthening its processes in order to enhance its effectiveness in providing independent assurance to the Monetary Board, the statement added.
The full statement issued by the Central Bank can be accessed here