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National Freedom Front

NFF: Accurate on attrition of auditor general in proposed 20A

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The provision under which companies registered under the Registrar of Companies and of which the government is the majority shareholder, have been removed from the audit process of the Auditor General

Statement from the NFF | October 2, 2020

Posted on: 22 October, 2020

true

True

Fact Check

FactCheck assessed this claim by evaluating the language and scope of Article 154(1) under the current constitution, as provided through the 19th Amendment, and under the proposed 20th Amendment (20A).

In the current Constitution, Article 154(1) lists the types of entities that are constitutionally defined to be under the audit purview of the auditor general. It specifically lists “companies registered or deemed to be registered under the Companies Act No. 7 of 2007, in which the government or a public corporation or local authority holds fifty per centum or more of the shares”.

The proposed 20A tabled in parliament, among other things, specifically removes such companies from the types of entities listed under the purview of the auditor general (for a side-by-side comparison of the exact wording, see www.factcheck.lk). That means, for example, entities such as Sri Lankan Airlines, Sri Lanka Telecom, LECO, Lanka Sathosa and Litro Gas Lanka, would be specifically excluded from the constitutionally assigned audit purview of the Auditor General.

Therefore, we classify the NFF’s claim as TRUE.

NOTE: In addition to removing the above category of entities, the purview of the auditor general is further eroded by the addition of the limiting clause “the accounts of” after the word “audit” in proposed amendments to article 154(1). Because the audit will be limited to the “accounts” of government entities, audit functions relating to, for instance, compliance with laws, regulations, policies, procedures etc. that relate to concerns of malpractice and corruption could be impacted. Many such audits have been undertaken by the auditor general in the past, and parliament has used such reports in exercising its oversight functions over the executive branch of government.

*FactCheck’s verdict is based on the most recent information that is publicly accessible. As with every fact check, if new information becomes available, FactCheck will revisit the assessment.

Exhibit 1: Article 154 under 19A and 20A

 



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