Jan 14, Colombo: Sri Lanka's Central Bank today said it has initiated many measures to strengthen transparency and accountability in many areas of its operations in line with the recommendations of the Presidential Commission of Inquiry (COI).
Issuing an update on the progress of implementation of the recommendations of the Presidential Commission of Inquiry to Investigate, Inquire and Report on the Issuance of Treasury Bonds during the period from 1 February 2015 to 31 March 2016, the Central Bank informed that many measures have already been implemented.
The Bank said that In relation to the legal framework within which the Central Bank operates, measures are under way to strengthen several laws applicable to the Central Bank.
Currently, amendments are being formulated with respect to the Monetary Law Act and the Registered Stocks and Securities Ordinance. Operations relating to issuance of Government securities were strengthened by introducing a new auction system for Treasury bonds.
A similar system is being formulated for Treasury bills as well. Pre-bid meetings are held regularly, the auction calendar is announced in advance and a policy of accepting no more than the total offered amount has been adopted. Internal controls in relation to the issuance process have been strengthened and the operational manual has been updated.
The fund management functions of the Employees' Provident Fund were strengthened by introducing a new robust Investment Policy Statement and an Investment Guideline. An updated operational manual is now in place with enhanced internal controls to mitigate risks and improve transparency and accountability.
The legal function was strengthened with increased resources and the internal audit function has widened its coverage and depth in terms of related risk exposures. A Whistleblowing Policy for employees and Codes of Conduct for all employees and Monetary Board Members have been introduced.
In addition to the above, several internal disciplinary proceedings are underway and civil recovery action has been filed to recover unlawful gains made by a Primary Dealer at the expense of the Central Bank and the Employees' Provident Fund.
On a complaint made by the Central Bank in November 2016 to the Inspector General of Police, criminal action has been initiated by the law enforcement authorities. Six Forensic Audits are nearing completion now.
In the future with respect to the Procurement process for forensic audits, as per the Government Procurement Guidelines, financial bids will be opened upon giving notice of 10 days to bidders who have scored above the minimum technical score.
The Full report is available at the Central Bank website.