A proposal for Sri Lanka’s new Constitution

By Prasad Polwatte and Dushanth Jayasinghe

Proposal: Inclusion of the concept of accountability in the new Constitution of the Democratic Socialist Republic of Sri Lanka

We as a nation are very proud of our educated workforce in the private and public sectors. However, when compared with other developed nations and in particular the neighbours, Sri Lanka falls behind, in displaying capabilities in manufacturing value added products, providing services meeting to international standards expected by stakeholders and in achieving Newly Industrialised Country (NIC) status. 

A habit of blaming previous governments has persisted for the past 72 years due to its underdeveloped status (evidenced by Sri Lanka being a developing country since its independence), corporate failures and the thriving white colour crimes. Our professionals and educated work force fall short of being accountable for the corporate collapses, white colour crimes, delays, failures in dispute resolution and poor state in integrated Enterprise Resource Planning (ERP) systems of our businesses. Limitations in the Common Law has prevented pursuing litigation and prosecution expeditiously in executing justice to society.

We are provided with private and public sector institutions with luxurious front offices but their back-office management, recordkeeping, and data processing have not been modernised and still remains with the past of the 18th century procedures and unproductive red-tape. Sri Lanka has been a pioneer in using information technology in our region with Sri Lanka Government having passed a special act in 1962 and inviting IBM to establish their local branch to improve electronic data processing in the country. Unfortunately, now we are dependent on our neighbours for ERP solutions.

There had been many collapses finance companies in the past due to the greed of directors and corporate managers and their failure in taking precautionary measures. Even the external auditors have not given adverse opinion on the liquidity, stability and the going concern of these businesses.

 The Non-Bank Supervision Division of the Central Bank of Sri Lanka had not been able identify the vulnerable situations of the collapsed finance companies. 

In the recent past the cause of the famous Brandix COVID-19 Cluster revolved around the contention that its HR Department had not taken adequate precautions in identifying and giving medical attention to sick employees. Even the Police and health authorities had a difficult task in tracing the infected and connected staff due to non-availability of accurate personnel data with Brandix.

Most Police complaints and legal disputes cannot be pursued due to the limitations, in evidence gathering and in investigation procedure, supported by inefficient systems of litigation and prosecution. There had been collusion of some Police and Prison officials with convicted criminals and become parties in drug trafficking and other crimes. Many litigation and prosecution cases were unable to pursue due to the errors/ lapses in Police Department records. The Police Department must have an integrated ERP connected to all Police Stations, Attorney General’s Department and the Courts system.

The Department of Immigration and Emigration, Department of Registration of Persons and most other Government departments are not in a position in providing information of dual citizenship-holders of our country.

Land registries are not computerised. Therefore, the same land could be registered in many different folios and different title deeds could be issued to the same land.

Heads of important institutions such as the Registrar of Motor Vehicles, Department of Inland Revenue, etc. must take immediate steps to have an integrated ERP in the present context.

As per the recent media reports many drug traffickers’ funds have been diverted via the banking system causing to question the effectiveness of Know-Your-Customer (KYC) and Customer Due Diligence (CDD) procedures.

Given consideration to the foregoing, to uphold democratic values, to sustain civilised form of living we propose to introduce and instil accountability in the duties of all private sector and public sector employees through a Constitutional enactment. Thereby, there has to be a responsible officer or officers for all identified frauds/losses/wastages. An employee cannot merely escape by saying that my supervising officer instructed me to do so despite of his/her knowing that it to be a fraud/loss. 

The above-mentioned details are a brief overview and probably requiring further deliberation. Thus, for any further clarifications you may contact the writers.

[Prasad Polwatte, Master of Arts in Economics (University of Colombo), Master of Business (Monash University, Melbourne), Fellow Member of the Institute of Chartered Accountants of Sri Lanka, Fellow Member of the Chartered Institute of Management Accountants UK, Associate Member of the Institute of Bankers of Sri Lanka, articled in a practicing accounting firm (SJMS) for four years, Senior Deputy Finance Manager Ceylon Petroleum Corporation, worked at Sampath Bank PLC for more than 17 years holding different responsible positions and retired as the Group Internal Auditor, Accountant at University of New England (Armadale, NSW Australia), Director at Singhagiri Ltd, DGM-Finance at the Associated Newspapers of Ceylon (Lake House), Group Internal Auditor at Nation Lanka Finance PLC, Group Internal Audit Consultant at Fairway Holdings. Email: [email protected]]

[Dushanth Jayasinghe, Associate Member of the Institute of Bankers Sri Lanka, articled in a practicing accounting firm (BR De Silva & Co), worked at Sampath Bank PLC for more than 30 years holding different responsible positions and retired as Manager Internal Audit, and Manager Internal Audit at 

Abans PLC.]