Report of the Audit Committee

The First Audit Committee of CEPA was formally constituted in 2012 as a sub-committee of the Main Board, to which it is accountable. The Committee from its inception was chaired by Deshamanya. P D Rodrigo (FCA), former Senior Partner of PricewaterhouseCoopers Sri Lanka and Non Executive Director of CEPA Board. During the year Mr. Deshal De Mel, Senior Economist at Hayleys Group, who joined the CEPA Board as a Non Executive Director was appointed to Chair the audit Committee. Mr. Chandra Jayaratne (FCA), Member of CEPA and Mrs. Mano Alles, Chairperson of the CEPA Development Fund Board of Trustees are the other members of the Audit Committee.

The Audit Committee, established for the purpose of assisting the Board in fulfilling its responsibilities relating to the integrity of financial statements, risk management, compliance with legal and regulatory requirements and review of external auditors independence and performance, has written terms of references, dealing clearly with its authority and responsibilities.

The following are the principal activities carried out by the Audit Committee during the year ended 31st December 2014.

Compliance with Financial Reporting
The Audit Committee reviewed the quarterly and annual financial statements for their integrity and the annual report for consistency of statements made therein so far as they relate to financial performance and financial position of the Company.
The review also included:

• Appropriateness and changes in Accounting Policies.
• Compliance with relevant Accounting Standards and applicable regulatory requirements.

Risk Management
The Audit Committee meets the Head of Finance and Administration and Executive Director on a quarterly basis and discusses with them the steps they have taken to have in force an effective system of internal control and to identify, monitor and manage the operational risks of the Company. A formal risk assessment and reporting process which was initiated in 2013 is being mainstreamed with activities of the organisation.

Compliance with Laws and Regulations
The Audit Committee reviewed the reports submitted by the management on the state of compliance with applicable laws and regulations, and settlement of statutory payments within the required periods.

External Auditors
The Audit Committee reviewed the independence and performance of the External Auditors, Messrs KPMG Ford Rhodes., Chartered Accountants.
Meetings of Audit Committee

 Three Audit Committee meetings were held during the year ended 31st December, 2014.

Deshal De Mel
Chairman - Audit Committee