Senior Govt. officials questioned over SLIC privatization

Nearly 40 persons, including Treasury Secretary P.B. Jayasundara, have been questioned by a parliamentary sub-committee over the controversial privatization of the Sri Lanka Insurance Corporation (SLIC). The meeting by the parliamentary probe committee lasted several hours and officials from accounting firms Ernst & Young and PricewaterhouseCoopers neither admitted nor confirmed whether their accounts were in accordance with international accounting standards since current assets and currents liabilities had not been disclosed, sources close to the committee said.

Among those – in addition to Dr Jayasundera (questioned for the second time) -- who appeared before the subcommittee were PERC Chairman W.M. Bandusena, former PERC Chairman Chrysantha Perera, former Treasury Secretary Charitha Ratwatte and former Treasury official Faiz Mohideen.

Parliamentarian Ravi Karunanayake, a member of the COPE sub committee, told The Sunday Times the individuals who were questioned had still not provided sufficient or adequate explanations and would therefore be called to appear before the subcommittee again on Tuesday. He said past attempts at questioning these officials had yielded unsatisfactory responses.
However, sources said the subcommittee was investigating the matter very deeply and wanted to get ‘to the bottom of it.”
Simultaneously, the ethics committee of the Institute of Chartered Accountants of Sri Lanka (ICASL) has conducted its own investigation on the two auditing firms.

The ethics committee has issued its report and decided to recommend to the Council of the ICASL that a disciplinary committee be appointed, informed sources said. They said both firms could face a two-year suspension if they were found culpable. “Ernst & Young were the auditors for the government up to the date of the SLIC privatization and PricewaterhouseCoopers were consultants to the government and therefore, should have protected the government's interest.

“The findings of the ICASL ethics committee inquiry would reveal a lot to the COPE inquiry. Since both committees are conducting similar investigations, they should use the resources of one to streamline and fast track their inquiry,” one source said.