කාර්ය සාධන වාර්තාව

nrayhw;Wif mwpf;if

Performance Report

2012

කළමනාකරණ විගණන දෙපාර්තදේන්තුව

Kfhikj;Jtf; fzf;fha;Tj; jpizf;fsk;

DEPARTMENT OF MANAGEMENT AUDIT

මුදල් හා ක්රFමසම්පාාද මමසා්යාාං ශය epjp> jpl;lkply; mikr;R> Ministry of Finance and Planning

මසහලල්ක්ප කාර්යාලය nrayfk; The Secretariat

ලකොළඹ 01. nfhOk;G 01. Colombo 01.

1

Financial and Physical Performance of the Department of Management Audit for the year 2011

is presented by this as per the instructions given in Public Finance Circular No.402.

Performance Report - 2012

Department of Management Audit

CONTENTS Page No.

01. Vision, Mission, Objectives, Functions and Responsibilities of the Department 02

1.1 Organizational Structure of the Department 04

02. Financial Administration 06

03. Physical Performance

3.1 Contribution to enhance effectiveness of Internal Audit functions of

the Public Sector 07

3.2 Provision of Guidelines for Internal Auditing 08

3.3 Strengthening Internal Audit functions of the Public Sector through the

Treasury Representation in Audit and Management Committees 09

3.4 Management Audit Functions of the Ministry of Finance and Planning and

Treasury Departments 09

3.5 Internal Auditing of the Development Projects implemented by the various

Departments of the Ministry of Finance and Planning 11

3.6 Special Investigations 11

04. Management of Human Resources and General Administration 15

2

01. Vision, Mission, Objectives and Functions of the Department

Vision

To be the most outstanding and value adding management audit partner for the best

performance and accountability of public service

Mission

To provide an independent and objective assurance and consulting services design to add

value and improve accountability of public services through systematic approach to audit

disciplines comprising of

Management Audit

Compliance and Operational Audit

Performance Audit

Information System Audit

Risk Management and

Governance Process

Objectives

1. Contributing to enhance the effectiveness of Internal Audit of the Public Sector.

2. Strengthening Internal Audit through Audit and Management Committees.

3. Introducing guidelines required to improve the Management Audit.

4. Assisting the top Management by performing Management Audit functions of the

Ministry of Finance and Planning and Treasury Departments.

5. Strengthening the process of Management Audit in the Development Projects.

6. Disclosure of irregularities takes place and may take place in the Public Sector

through special investigations and introduction of preventive measures and

recommendations to curb such situations and occurrences.

3

02.

Functions and Responsibilities

1. Performing Management Audit in respect of the Ministry of Finance and

Planning, Treasury Departments and projects coming under them.

2. Providing necessary technical support by coordinating Internal Audit

Divisions of all Departments under the Ministry of Finance and Planning

as well as Internal Audit Units of other Ministries and Departments

3. Performing the following activities to achieve success in Management

Auditing Process.

Providing necessary guidance by co-ordinating Internal Audit Units.

Direct involvement in providing necessary guidance and Treasury

representation to strengthen the process of Audit and Management

Committees.

Review of Internal Audit plans of all Internal Audit Units and guide

for necessary improvements.

Conducting Special Investigations and reporting those whenever

necessary.

Taking action to introduce a Manual inclusive of Internal Audit

Guidelines and to update it with latest trends.

Improving Audit Skills of Internal Audit Units by organizing training

workshops on Management Auditing.

4

1.1 Organizational Structure of the Department

Director General

Deputy

Director

Addl. Director General

Director - 2

Asst.

Director

Research

Assistant

M.A

M.A

M.S

V

M.A

M.A

M.A

M.A

M.A

M.A

M.A

M.A

M.A

C.M.A

Deputy

Director

Deputy

Director

Deputy

Director

Deputy

Director

Deputy

Director

Director - 1

Director - 3

Asst.

Directo

r

Research

Assistant

Research

Assistant

Research

Assistant

M.A

Director - 4

Deputy

Director

M.A

Director - 5

5

2. Financial Administration

In the Budgetary Estimates for the year 2012, provisions had been made for this Department

under Head 324 Programme 01 Project 01. The expenditure incurred is given in the following

table.

Particulars of Expenditure Budgetary

Estimates

(Rs.)

Supplementa

ry Provisions

(Rs.)

Transfers in

terms F.R.66

& 69 (Rs.)

Actual

Expenditure

(Rs.)

Savings (Rs.)

Recurrent Expenditure 21,900,000 2,770,000 -50,000 23,882,818 737,182

Personnel Emoluments 15,600,000 0 -35,000 15,324,307 240,693

Other Expenditure 6,300,000 2,770,000 -15,000 8,558,511 496,489

Capital Expenditure 1,000,000 1,600,000 50,000 2,277,049 372,951

2001 Building &

Structures

0 1,600,000 0 1,378,747 221,253

2002 Plant, machinery &

equipment 100,000 0 50,000 149,375 625

2003 Vehicles 100,000 0 0 0 100,000

2102 Furniture & office

equipment 100,000 0 -95,000 4,800 200

2103 Plant, machinery &

equipment 100,000 0 95,000 190,982 4,018

2401 Training & Capacity

Building 600,000 0 0 553,145 46,855

TOTAL 22,900,000 4,370,000 0 26,159,867 1,110,133

Government Officers’ Advance ‘B’ Account

The following table shows the details of the Government Officers’ Authorized Advance ‘B’

Account of this Department for the year 2012.

Particulars Approved Limit

(Rs.)

Actual Expenditure

(Rs.)

Maximum Limit of

Expenditure

2,000,000.00 1,284,767.00

Minimum Limit of

Receipts

1,200,000.00 2,008,869.93

Maximum Debit Balance

Limit

11,000,000.00 8,055,012.54

6

3. Physical Performance

3.1 Contribution to enhance the effectiveness of Internal Audit Functions of

Public Sector

3.1.1 Capacity Building of Internal Auditors

Department of Management Audit constantly supports the internal auditors serving in the

Ministries and Departments of the Government to improve and upgrade their professional

skills. Following Workshop was conducted by the Department with the same objective

during the year 2012.

A workshop to make the internal auditors aware of the contents of the proposed Internal

Audit Manual and the administration of the Audit and Management Committees was

held in Randora Auditorium of the Ministry of Finance and Planning on 06.12.2012.

3.1.1 Compilation of an Internal Audit Manual

A manual inclusive of the guidelines for internal auditing was compiled by the Department

of Management Audit. Opinions were taken having submitted the manual to the following

Committee of interlectuals and the final draft was submitted to the Secretary to the Treasury

for the approval.

- Mr. V Kandasami, Retired Deputy Auditor General.

- Mr.Tissa Marasinghe, Former Director, Institute of Government Accounts and

Finance (INGAF).

- Mr.K.K.V.Jayarathne, Former Additional Director General, Department of

Treasury Operations.

- Mr.N Sooriyakumar , Chief Accountant, Ministry of Resettlement.

7

3.2 Provision of Guidelines for Internal Auditing

Information and Communication Technology based on computer programmes is frequently

used to carry out the services provided by the Ministries, Departments and Projects more

effectively and efficiently. This has been further encouraged by the e-Sri Lanka programme.

Under such circumstances, the Auditors of the Public Sector shoud acquire adequate skills in

order to evaluate the utility,accuracy,transparency and value for money, etc. of such

computer programmes. As a result of identifying such requirements, with the view of

founding the basis to carry out internal auditing activities within an environment of

Computerised Information Systems, following Circular was issued by the Department

including guidelines and questionnaires in that respect.

Management Audit Circular No.DMA/07-Guidelines for Internal Auditing

within an Environment of Computerised Information Systems

As the guidelines and the questionnaires introduced by the above circular provide a basic

understanding which is needed to carry out the internal auditing activities within an

environment of Computerised Information Systems,the Auditors of the Public Sector will be

able to formulate thier annual internal auditing plans by upgrading the aforementioned

guidelines to befit the requirements of their institutions.

3.3 Strengthening Internal Audit Functions of the Public Sector through

the Treasury Representation in Audit and Management Committees

The staff Officers of the Department have actively participated in the Audit and

Management Committees (AMCs) established in each and every Ministry of the

Government. As Treasury representatives, those officers have rendered guidance and

guidelines to conduct these committees productively and necessary instructions have

been given to relevant ministries on the preventive measures to be taken accordingly

having discussed the audit reports of the Auditor General and the Internal Auditor.

8

At least one Audit and Management Committee meeting should be held per quarter by each

and every Ministry. Accordingly, the officers of the Department have participated in 161

Audit and Management Committee meetings held by the 54 Ministries and 15 such meetings

held by the Presidential Secretariat, Prime Minister’s Office, Parliament, Office of the Senior

Ministers, Office of the Commissioner of Elections and the Public Service Commission

during the year 2012.

3.4 Management Audit Functions of the Ministry of Finance and Planning

and Treasury Departments

Management Audit functions of the Ministry of Finance and Treasury Departments have

been continuously carried out by this Department in the year 2012 also. This has

facilitated the Heads of Departments to maintain an efficient and effective internal

control system and a high performance in their Departments. In view of this objective,

internal audit functions of the following Departments were carried out in the year 2012.

01. All the Divisions of the Ministry of Finance and Planning

02. Department of Import and Export Control

03. Department of Public Finance

04. Department of Fiscal Policy

05. Department of Management Services

06. Department of Management Audit

07. Department of State Accounts

08. Department of Legal Affairs

09. Department of National Budget

10. Department of Development Finance

11. Department of National Planning

12. Department of Treasury Operations

9

13. Department of Public Enterprises

14. Department of External Resources

15. Department of Trade and Investment Policy

16. Department of Project Management and Monitoring

80 Management Audit Reports inclusive of a basic evaluation report at the beginning of the

year and a quarterly report for each quarter have been issued to all the Heads of above

Departments in the year 2012 .

Observations of the Heads of the Departments on the reports sent to each Department were

obtained and Audit and Management Committee meetings were held under the chairmanship

of the Secretary to the Treasury in order to take necessary decisions to prevent shortcomings

and deficiencies pointed out by the afore mentioned reports. Three Audit and Management

Committee meetings (AMCs) were thus held in the year 2012 chaired by the Secretary to the

Treasury and the AMC meeting for the last quarter will be held in the first quarter of the year

2013.

In addition, the important matters revealed by the audit queries conducted by the Internal

Audit Units and the Auditor General of the following Departments which are under the

purview of the Ministry of Finance and Planning were submitted to the Audit and Management

Committee and were brought to the attention of the Secretary to the Treasury.

1. Department of Sri Lanka Customs

2. Department of Inland Revenue

3. Department of Excise

4. Department of Valuation

5. Department of Census and Statistics

10

Moreover, the management audit functions of the following institutions were carried out by the

Department of Management Audit in the year 2012.

Academy of Financial Studies (AFS).

Sri Lanka Insurance Board

3.5.5 Internal Audit of the Development Projects implemented by the various

Departments of the Ministry of Finance and Planning

This Department carries out the internal audit functions of the foreign funded projects

implemented by the various Departments of the Ministry of Finance and Planning. Accordingly,

the Department carried out the internal auditing of the following project during the year 2012 .

Small and Medium Enterprise Development Facility Project (SMEDeF)

This project is implemented by the Department of Development Finance under the assistance of

the World Bank. As per the project agreement signed by the Government and the World Bank,

the internal auditing of the project is assigned to this Department and it carries out the internal

auditing all throughout the project period .03 Internal Audit Reports with respect to the above

project have been submitted to the Secretary to the Treasury in the year 2012.

3.6 Special Investigations

The complaints made to His Excellency the President as the Honourable Minister of Finance

and Planning and to the Secretary to the Treasury are forwarded to the Department of

Management Audit as per the order of the Secretary to the Treasury for investigating and

reporting. The reports of the investigations made are submitted to the Secretary of the relevant

Ministry or to the Head of the relevant institution for necessary actions, as per the instructions

of the Secretary to the Treasury and its objective is to prevent repetition of deficiencies and

irregularities revealed by the investigation.

11

Investigations Conducted by the Department of Management Audit in 2012

Reports were submitted having conducted investigations with respect to the following

complaints forwarded to this Department by the Secretary of the Ministry of Finance and

Planning.

Institution Investigation

01 Employees Trust Fund Harassment caused by the Deputy General Manager/

Manager

02 Regional Inland Revenue

Department

Irregularities and Corruptions taken place in the

refurbishment of the Department.

03 Swarnamali Balika Vidyalaya,

Kandy and State Distilleries

Regarding the land to be transferred to Swarnamali

Balika Vidyalaya, Kandy

04 Ministry of Finance For establishing a separate investigation unit under

the Ministry of Finance

05 National Insurance Trust Fund Request for a fair investigation on internal audit

activities.

06 Department Census and Statistics Revealing a large scale fraud done by a private

security firm

07 Department of Sri lanka Customs Allegations made against Sri Lanka Customs

08 Petrolium Corporation

Regarding the article appeared in Lankadeepa on

corruptions of the Petrolium Corporation

09 National Zoological Gardens,

Dehiwala

For the protection of the lives of animals

10 Department of Excise Informing about the prevailing corruptions

11 Nuwara-eliya District Secretariat About the voice of the people of the Nuwara-eliya

District about the outcomes of the informal

development approach

12 Ministry of Provincial Councils Recruitment of Officers contrary to the Circulars -

Provincial Road Development Project implemented

12

under the World Bank Funds of the Ministry of

Provincial Councils

13 Agriculture & Agrarian Insurance

Board

Obtaining concessionary motor vehicle permits

submitting inaccurate documents.

14 Central Cultural Fund Making recruitments exceeding the approved cadre

15 Inland Revenue Department Regarding group transport

16 Department of Census & Statistics Regarding the losses inflicted by the floods on

11.11.2012

17 Bank of Ceylon - Head Office Regarding the massive frauds taking place in the

International Division

18 Rural Development Research and

Training Institute

Saving an institution important to the the country and

the poor citizens

19 Sri Lanka Social Security Board Fraud of Pensions

20 Ministry of Health Regarding the Chief Accountant

21 Miloda Institute Irregularities of MILODA

22 Ministry of Local Government Regarding the allocation of provisions of the project

funded by the World Bank.

23 Sugarcane Research Institute Regarding the Executive Director

24 Department of Technical

Education and Training

Not acquiring services without assigning duties to a

set of officials who are drawing higher salaries

25 Karapitiya Hospital Regarding the admission of patients who needs

emergency care

26 Sri Lanka Social Security Board Regarding the purchase of a new computer system

27 Ceylon Fisheries Corporation Irregularities taking place in the Corporation

28 State Mortgage and Savings Bank Irregularities made in purchasing of a computer

system.

13

29 National Lotteries Board Purchasing sarees for female employees

30 Agriculture Insurance Board

(Anuradhapura)

Misuse of office vehicle

31 National Insurance Trust Fund Anomalous practices and cruelty of a Member of the

Board of Directors.

32 Lankaputhra Development Bank Regarding the Chairman of Lankaputhra

Development Bank.

33 National Lotteries Board (NLB) Irregularities and corruption occurring in the NLB.

34 Agriculture and Agrarian

Insurance Board

Regarding the investigation which is conduced under

the Bribery Act.

Similarly, when it seems necessary that a special investigation shoud be conducted with respect

to a certain matter related to any of the Departments or Institutions under the purview of the

Ministry of Finance and Planning raised by news published in mass media, such investigations

are conducted on the approval of the Secreatary to the Treasury.

Accordingly, it has reported having conducted an investigation on the following news in the year

2012.

The Credit Information Bureau of Sri Lanka - Regarding the article appeared in Dinamina on

17.10.2012 with the heading of “ හැඳුනු්පාත් මාං ක මවුලලන් ණය මයදු්පකරුවන් මමසාරුලේ”

(Difficulties faced by loan applicants due to the chaos of NIC Nos)

Moreover, as per the instructions of the Secretary to the Treasury, a report was submitted having

studied the procedure of responding to the letters received to all the Treasury Departments.

Necessary instructions were given to each of the Departments to rectify the dificiencies pointed

out by the aforementioned report having conducted a meeting presided by the Secretary to the

Treasury.

14

4. Management of Human Resources and General Administration

4.1 Staff

The approved cadre of this Department functioning under the purview of the Director

General of Management Audit is 41 and the detail of the staff relevant to the year 2012 is

given below.

Post Cadre

Approved Actual Vacancies

Director General 01 01 -

Additional Director General 01 01 -

Director (SLAcS) 05 05 -

Deputy Director (SLAcS) 07 02 05

Assistant Director (SLPS/SLAS) 02 02 -

Research Assistant 04 01 03

Public Management Assistant 14 13 01

Driver 05 05 -

O.A.S 04 04 -

Total 43 34 09

Officers transferred to the Department in the year 2012

Name Post

01. Mr.D.U.S.Wickramaarchchi Additional Director General

02. Miss V.I.Dilhani Assistant Director

03. Mrs.K.K.R.Fernando Public management Assistant

04. Mr.H.S.W.Gunasekara Public management Assistant

15

05. Mrs.S.A.S.K.Satharasinghe Public management Assistant

06. Mr.H.A Rajakaruna Public management Assistant

07. Mr.G.B.S.Dayarathna Public management Assistant

08. Mr.G.K.C.Pushpakumara Driver

09. Mr.L.A.K.Dharmadasa Driver

10. Mr.D.K.Jayarathna Driver

11. Mr.J.M.L.Pushpakumara Driver

12. Mr.J.A.Shriyananda O.A.S

13. Mr.R.D.D.Senanayaka O.A.S

Officers transferred out of the Department in the year 2012

Name Post

01. Mr.Wasantha Ekanayaka Director General

02. Mrs.G.C.N.Fonseka Deputy Director

03. Mrs.K.V.C.Dilrukshi Assistant Director

04. Mr.H.S.W.Gunasekera Public management Assistant (Period April-December

2012 )

05. Mrs.S.A.S.K.Satharasinghe Public management Assistant (Period January-

December 2012 )

06. Mr.G.B.S.Dayarathna Public management Assistant (Period June-December

2012 )

07. Mrs.P.K.C.Fernando Public management Assistant

08. Mrs.S.A.P.Ranjani Public management Assistant

09. Mr.I.B.Senanayaka Public management Assistant

10. Mrs.D.P.Pathmini Public management Assistant

11. Mr.L.A.K.Dharmadasa Driver (Period May – August 2012)

12. Mr.B.K.D.Kodituwakku Driver

13. Mr.R.A.K.Karunajeewa Driver

16

14. Mr.J.A.Shriyananda O.A.S (Period January-December 2012)

15. Mr. U.D.S.Jayalath O.A.S

Officers retired in 2012

01. Mr. K.M.Jayathilake Director General

02. Mr.D.L.Thilakarathne Deputy Director

4.2 Staff Training

4.2.1 Local Training

Officers were participated in local and foreign training programmes in the year 2012 also with

the objective of enhancing the professional skills of the staff for the Human Resource

development of the Department.

Local Training - 2012

The officers of the Department participated in local training programmes in the year 2012 as given below.

Training Period Training Programme Name of the Officer Designation

From 11.01.2012 Basic Tamil Miss.B.M.Gunartna

Mrs.P.K.C.Fernando

Management

Assistants

2011-2012 DIPPCA Mrs.K.V.C.Dilrukshi Asst.Director

21.02.2012-

22.02.2012

Forum on Public Financial

Management

Mrs.S.A.C.Kulathilake

Mrs.K.P.Wijewantha

Mr.H.C.D.L.Silva

Mrs.G.C.N.Fonseka

Miss.A.K.Gunasekera

Director

Director

Deputy Director

Deputy Director

Asst.Director

From 10.05.2012

Diploma in

Communicational Skills in

English

Mr.W.G.T.Chanaka Management

Assistant

17

Training Period Training Programme Name of the Officer Designation

From 10.05.2012

Diploma in

Communicational Skills in

English

Mr. H.A.Rajakaruna Management

Assistant

14.05.2012–

19.05.2012 Payroll Mr.H.A.Rajakaruna

Management

Assistant

28.05.2012–

01.06.2012

Public Financial

Management Mrs.H.K.C.Priyadarshani

Management

Assistant

From 28.06.2012 Tamil – 2nd

stage Mrs.A.Weerarathna

Mrs.P.K.C.Fernando

Miss.B.M.Gunarathna

Management

Assistant

16.07.2012–

20.07.2012

Advanced Computer

Training

Mrs.A.Weerarathna

Management

Assistant

24.07.2012 One day workshop for

drivers Mr.R.A.K.Karunajeewa Driver

02.08.2012 Workshop on Introduction

to Project Management Miss.A.K.Gunasekera Asst.Director

09.08.2012–

13.12.2012 Tamil Lectures (Spoken) Mrs.D.K.D.Liyanage

Management

Assistant

13.08.2012–

15.08.2012 MS Excel

Mrs.K.R.R.Fernando

Mrs.D.K.D.Liyanage

Management

Assistant

27.08. 2012–

29.08.2012

Performance Enhancement

of Office Assistants Service

Mr.K.D.N.Premalal

Mr.J.A.Shriyananda O.A.S

10.09.2012–

14.09.2012 Advanced computer training Mrs.G.D.K.Liyanage

Management

Assistant

27.09.2012–

28.09.2012

Training on Government

Auditing Mrs.H.K.C.Priyadarshani

Mrs.K.R.R.Fernando

Management

Assistant

06.10.2012–

07.10.2012

Performance Enhancement

& Personnel Development Mr.S.K.Kusalakumaran Deputy Director

16.10.2012 Salary Conversion Mrs.P.K.C.Fernando

Mrs.H.D.D.S.Gunasekera

Management

Assistant

01.11.2012– Pension Matters Mrs.A.Weerarathna Management

18

Training Period Training Programme Name of the Officer Designation

02.11.2012 Assistant

07.11.2012–

08.11.2012 aat Conference - 2012 Mr.S.M.Dayarathna Director

28.11.2012 -

30.11.2012

Stores & procurement

procedures Mrs.K.R.R.Fernando

Management

Assistant

December 2012

Master of Public

Administration/ Public

management -2012/2012

Mrs.S.A.C.Kulathilake Director General

4.2.2 Foreign Training

Officers have participated in foreign training programmes and delegations in the year 2012 as

mentioned below.

Name of the officer Designation Country Training Programme Period

Mr.K.M.Jayathilake

Addl.

Director

General

Switzerland Management Audit

Mission

12.02.2012–

13.02.2012

Mis..K.V.C.Dilrukshi Assistant

Director

India &

China

International capacity

Building Workshop in

Public Sector

Management &

Leadership in Urban and

Rural Management

21.07.2012–

29.07.2012

Mr.S.M.Dayarathna Director Thailand

Second country study

visit of Master of Public

Management Degree

Programme

10.09.2012–

22.09.2012

Mrs.M.A.K.P.Wijewantha Director Dubai &

Thailand

Second country study

visit of Master of Public

Management Degree

Programme

12.12.2012–

22.12.2012

19

4.2.3. Performance Enhancement Programmes

Following programmes were organized in the year 2012 with the view of upgrading the

performance of the entire staff of the Department.

A series of performance enhancement programmes was held in the auditorium of the

Ministry of Finance and Planning from 12.03.2012 to 23.03.2012 with the view of

giving a a formal training on the internal audit functions of the Department to the entire

staff including the officers who joined the Department recently.Lectures were delivered

by the senior officials of the Department and external resource persons covering various

subjects including keeping state acconts,practical audit activities,general behaviour and

disciplinary procedures,procurement and office systems

A performance enhancement programme was conducted at the Bogahapalassa Training

Centre, Kataragama under the theme of working with team spirit in delivering day to day

duties and the role of Public Officers in maintaining the productivity of Government

Institutions.