President's Fund: AG finds faults
By Chandani Kirinde
In his report on the accounts of the President's Fund for the year 2003, submitted to Parliament on Friday, the Auditor General has noted several accounting deficiencies.

According to the accounts presented for audit, the operations of the Fund during the year under review discloses a deficit of Rs. 586,574,229 as against the surplus of Rs. 329,255,939 for the preceding year thus disclosing a decrease of Rs. 915,830,168.

The Report also noted that the Board of Governors of the Fund who are vested with the administration, management and control of it under the President's Fund Act No. 7 of 1978, had not held any meeting since July 18, 2001, up to the date of audit on March 16, 2004, to decide on the utilisation and investment of the moneys of the Fund.

According to the Income and Expenditure Account of the Fund for the year under review, a sum of Rs. 156,197,957 had been shown as receipts from the Development Lotteries Board (DLB) but according to information received by the audit the correct amount was Rs. 631, 926,664, the Report said.

The DLB had purchased debentures for a sum of Rs. 6,000,000 receivable from the Board for the year 2001 and had transferred those debentures to the Fund during the year. However that amount has been brought to account as a receipt for the current year, it said.

In another instance flood relief aid of 2000 pounds received in July, 2003 and a sum of Rs. 350,000 paid as scholarship aid had not been brought to account and in another case even though the parents of a patient had stated that the medical aid of Rs. 500, 000 paid on September 23, 2003 was not necessary as the patient had died, that amount has been brought to account as a donation.

A sum of Rs. 1,089,989 refunded out of a donation made during the year 2002 had been credited on an expenditure account during 2003 thus understating the expenditure for the year by that amount.

Provision for doubtful debts had not been made even during 2003 in respect of several loans remaining non-performing over a number of years. They include Rs. 195,000,000 borrowed in 1993 by the National Housing Development Authority, Rs. 50,000 borrowed in the same year by the Welfare Society of the Presidential Secretariat, Rs. 3,000,000 also in 1993 by the National Film Corporation and Rs. 1,145,000 in 1995 by the Sri Lanka Red Cross Society.

A sum of Rs. 150,000,000 paid during the year under review to the Mahapola Higher Education Scholarship Trust Fund has not been shown as a payment in the financial statement. Additionally action had not been taken during the year under review for the settlement of the balance Rs 1,758,703 payable to the Mahapola Fund since 1993, the Report said.

The Auditor General said special attention is needed in respect of utilisation of funds, accounting, investments, receivables and receipts from the Development Lotteries Board.

The balance of the President's Fund as at December 31, 2003 stood at Rs. 2,313,771,588 with withdrawals in that year standing at Rs. 543,898,796 and investments at Rs. 439, 848,195.

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