Annual Report.CDR - Colombo Stock Exchange

C O R P O R AT E G O V E R N A N C E ( C O N T D . )
Audit Committee
The Board has formally constituted the Audit Committee comprising of five Non-Executive Directors to
carryout the control procedure efficiently and professionally. With the restructuring of the Board in February
2009, the Board together with the Managing agent (MBSL) sought the approval from the Central Bank of Sri
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Lanka to reconstitute the Audit Committee. The approval to establish a Audit Committee was received on 10
December 2009 consisting of three Non-Executive Directors. TheAudit Committee met three times during the
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period under review and four times since 1 April 2010 to 30 August 2010 and the Head of Finance and
representatives of Internal and ExternalAuditors also attend theseAudit Committee meetings. Their functions
include the following:
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InternalAudits
Implementing effective Internal control system and reviewing internal and external audit plans
Implementing Auditor's significant recommendations and ensuring that sound financial reporting
system exist within the Company.
Ensure that the Company complies with all relevant statutory polices and requirements and, fair and
accurate information are provided to all stakeholders.
To review and monitor the external auditors independence and objectivity and the effectiveness of the
audit process in accordance with applicable standards and best practices.
To review the monthly, quarterly and annual financial statements of the Company before these are
submitted to the Board of Directors and assess whether these are prepared in accordance with the Sri
LankaAccounting Standards and the requirements of the CompaniesAct
The Board also appointed a Remuneration Committee, an Integrated Risk Management Committee and a
Assets and Liability Committee and is awaiting for the formal approval of the Central Bank of Sri Lanka
Apart from the above meetings, the Internal Control Division continuously to assess the effectiveness of the
financial and operational control systems and submits a report on the findings to the Chairman/ Managing
Director andAudit Committee.
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ExternalAudits
The External Auditors are appointed by the shareholders at the Annual General Meetings and are responsible
for giving their opinion on the financial statements prepared by the Company.
The Central Bank also conducts its audits to ensure that the Company Complies with the regulations laid down
by the Central Bank of Sri Lanka. In addition, a reporting system is in place, which requires the Company to
submit detailed reports concerning key areas of operations on a weekly/monthly/quarterly/ annually to the
Non-banking Supervision unit of Central Bank.
Transparency and Compliance
The Board endeavors to ensure transparency of its operations by preparing and circulating to their shareholders
the Annual Reports and its quarterly financial statements of the Company. In addition the company also
publishes the bi annual and year end un-audited financial statements in all three languages in the national press.
The statutory compliance report is submitted to the Board at their meetings by the Head of Finance. The report
indicates the conformance with the statutory regulations and any deviations thereof.
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