ANNUAL REPORT - The Parliament of Sri Lanka | Welcome€¦ · Training, research and consultancy services towards upliftment of the quality of life of the people. 2. Mandate Institutional

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ANNUAL REPORT

2006

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Contents…………..

CORPORATE GOVERNANCE STATEMENT ................................................................................................... 3

GOVERNING COUNCIL ................................................................................................................................ 4

AUDIT & MANAGEMENT COMMITTEE ........................................................................................................ 5

FUNCTIONS OF THE INSTITUTE .................................................................................................................. 6

APPROVED CARDRE 2006 ............................................................................................................................ 9

PERFORMANCE ........................................................................................................................................... 12

STATEMENT OF FINANCIAL PERFORMANCE ............................................................................................ 21

STATEMENT OF FINANCIAL POSITION ..................................................................................................... 22

CONSOLIDATED CASH FLOW STATEMENT…………………………………………………………………………….23

STATEMENT OF CHANGES IN NET ASSETS ................................................................................................ 24

ACCOUNTING POLICIES ............................................................................................................................ 25

NOTES TO THE ACCOUNTS ....................................................................................................................... 27

AUDITOR GENERAL'S REPORT………………………………………………………………………………………….....32

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1.0. CORPORATE GOVERNANCE STATEMENT

Name of the Institute : Sri Lanka Institute of Local Governance (Incorporated by an Act of Parliament No. 31 of 1999)

Date of commencement of the Operations : 15th October 1999

Registered Office : No. 17, Malalasekara Mawatha,

Colombo 07.

Auditors : Auditor General

Auditor General’s Office

Colombo 07.

Bankers : Bank of Ceylon

Independence Square Branch,

Colombo 07.

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2.0. GOVERNING COUNCIL

The Governing Council of the Institute comprises of Thirteen (13) Members including

Eight (08) Ex Officio Members and the rest appointed by the Hon. Minister.

The appointed Governing Councils for 2006

1. Mr. Cashian Herath - Secretary

Chairman Ministry of Local Government & Provincial Councils

2. Dr. P.B. Jayasundara - Secretary

Member Ministry of Finance

3. Mr. D. Dissanayake - Secretary

Member Ministry of Public Administration & Home Affairs

4. Mr. M.A.R.D. Jayathilake - Secretary

Member Ministry of Environment & Natural Resources

5. Dr. P.B. Ramanujam - Secretary

Member Ministry of Urban Development & Sacred Area

Development

6. Ms. Chandra Miyanawala - Senior Assistant Secretary

Member Ministry of Cultural Affairs & National Heritage

7. Prof. S.T. Hettige - Senior Professor

Member Department of Arts, University of Colombo

8. Mr. A.G. Athurugiriya - Secretary to the Governor (Western Province)

Member

9. Mr. J.G. Keerthiratne - Former Secretary

Member Ministry of Local Government & Provincial Councils

10. Mr. H.D.G. Wickramasinghe - Appointed Member

Member

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11. Dr. Fahmy Ismail - National Technical Advisor

Member UN-Habitat/SCP

12. Mr. Nimal K. Bandara - Director /Sri Lanka Institute of Local Governance

Member/ Convener

3.0. AUDIT & MANAGEMENT COMMITTEE

Action is being taken by the Governing Council to appoint the Audit & Management Committee

in due course.

a) Mr. J.G. Keerthiratne - Member of the Governing Council

b) Mr. H.G.D.C. Wickramasinghe - Member of the Governing Council

c) Dr. Fahmy Ismail - Member of the Governing Council

d) Mr. Nimal K. Bandara - Director of the Institute

e) Mr. Dilan Fernando Pulle - Acting Additional Director of the Institute

f) Mr. P.K. Dharmasena - Accountant of the Institute

Observer

Mr. W.L.G. Nimal Shantha - Acting Audit Superintendent

Department of Auditor General

Committee Secretary

Ms. Dilini Peramuna - Board Secretary

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4.0. FUNCTIONS OF THE INSTITUTE

Sri Lanka Institute of Local Governance was set up by a Parliamentary Act No. 31 of 1999.

The functions of the Institute are as follows:-

a) To provide training to the members and officers and servants of Provincial Councils and

Local Authorities with a view to equipping them to perform their official duties efficiently

and effectively;

b) To conduct workshops and training courses on provincial and local government

management;

c) To award certificates to those who have successfully completed the training courses

conducted by the Institute;

d) To assist in the building up of a cadre of competent provincial and local government officers

and personnel in the country, with a view to ensuring good governance;

e) To make available to provincial councils and local authorities, the services of specialists in

provincial and local government management;

f) To assist provincial councils and local authorities in improving their organizational systems

and management capability;

g) To undertake consultancy assignments in the field of provincial and local government;

h) To provide a forum for critical appraisal of provincial and local government organizational

management systems and practices;

i) To assist provincial management development training units and local authorities in,

management development and the establishment of work norms, determination of

compensation system, and generally, to improve their productivity;

j) To collaborate with other organizations, in Sri Lanka or abroad having objects similar to

those of the Institute;

k) To sponsor and hold, conferences & seminars and to publish books and magazines, on

provincial and local government;

l) To provide necessary data and information to the Minister, for the propose of formulating

national policies on local government;

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m) To disseminate information of the functions and activities of the Institute to the relevant

institutions and to the public;

n) To conduct, promote and assist research into all aspects of provincial and local government;

To facilitate the achievement of these functional responsibilities, the institute has constituted its,

1. Mission

To be the foremost national agency in local governance for building capacity of sub

national (regional/provincial) and local government institutions through advocacy.

Training, research and consultancy services towards upliftment of the quality of life of the

people.

2. Mandate

Institutional strengthening and capacity building of provincial councils and local

government institutions.

3. Overall Objectives

To facilitate the institutional and management capacity building of provincial councils

and local authorities for the efficient and effective provisions of services to the people.

4. Specific Objectives

a) To formulate and deliver a programme of capacity building activities for the

institutional strengthening of local governance in partnership with provincial

MDTUs.

b) To support and strengthen the capacity of MDTUs towards delivering training

and development programmes for improving the performance of provincial

councils and local authorities.

c) To function as a resource center on local governance providing technical and

information services for its stakeholders.

d) To function as the local point for local governance networking with relevant

national and international institutions.

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e) To provide specialist support services in the development of human resources,

improvement of management systems, and organizational change.

f) To build the capacity of SLILG to provide advocacy, training, consultancy and

research support for strengthening institutions of local governance.

In order to achieve these objectives the institute has identified the following strategic directions in

fulfilling its mission and objectives.

Institutional capacity building

Training and consultancy services

Research studies on devolved governance

Function as a resource centre

Networking with National and International training and educational institutions.

A broad framework of activities has been identified and followed as a step to facilitate the take off,

and new areas have been incorporated into the functional framework.

5.0. HUMAN CAPITAL

The approved cadre is 33 and the present strength is 22. The steps which had been taken to

fill the vacancies were kept in abeyance as compliance to government policy.

However, as directed by the Auditor General by his reports during past 02 years immediate

action will be taken to establish and Internal Audit unit by way of recruiting and Audit

Officer and a Cashier for the Finance Division.

Total Cadre is given below:-

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Approved Cadre 2006

DIVISION

APPROVED CARDRE ACTUAL CADRE Executive Non

Executive

Total Executive Non

Executive

Total

Administration and

Secretarial division

03 13 16 02 13 15

Human Resource

Development division

09 - 09 06 - 06

Engineering division

02 - 02 02 - 02

General Management

division

02 - 02 02 - 02

Physical Planning

division

01 - 01 01 - 01

Financial

Management division

02 - 02 01 - 01

Legal division

01 - 01 - - -

Research division

04 - 04 03 - 03

Finance division

02 - 02 01 - 01

Internal Audit division

01 - 01 01 - 01

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Administration and Secretarial division

DESIGNATION APPROVED CADRE ACTUAL CADRE

Director 01 01

Secretary to the Director/Board 01 01

Administrative Officer 01 -

Stenographer 01 -

Chief Clerk 01 01

Clerk – Grade 1 01 -

Typist (English) 01 -

Typist (Sinhala) 01 -

Data Entry Operator 01 01

Clerk – Grade II 01 03

Driver – Grade I 01 -

Driver – Grade II 02 04

Messenger 01 -

K.K.S. 02 04

Total 16 15

Human Resource Development division


Additional Director 01 01

Deputy Director (Training) 01 -

Programme Officer 01 01

Translator (Sinhala / English) 01 -

Translator (Sinhala/Tamil) 01 -

Project Assistant 03 03

Programme Assistant 01 01

Total 09 06

Engineering division


Consultant (Engineering) 01 01

Programme Assistant

(Engineering)

01 01

Total 02 02

General Management division


Consultant (General

Management)

01 01

Programme Assistant (General

Management)

01 01

Total 02 02

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Physical Planning division


Consultant (Physical Planning) 01 01

Total 01 01

Financial Management division


Consultant (Financial

Management)

01 -

Programme Assistant (Financial

Management)

01 01

Total 02 01

Legal division


Consultant (Legal) 01 01

Total 01 01

Research and Publication division


Deputy Director (Research) 01 -

Research Assistant 01 01

Documentation Assistant 01 01

Programme Assistant (Research) 01 01

Total 04 03

Finance division


Accountant 01 01

Accounts Assistant 01 01

Clerk – Grade II - 01

Total 02 03

Internal Audit division


Programme Assistant (Internal

Audit)

01 01

Total 01 01

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6.0. PERFORMANCE

Human Resource Development

One of the main task assigned to the Sri Lanka Institute of Local Governance is to strengthen

provincial councils and local authorities by providing training to accomplish their tasks efficiently

and effectively. To achieve the objectives, the Sri Lanka Institute of Local Governance conducts the

following workshops and training programmes,

a) National level workshops and training programmes

b) Provincial level workshops and training programmes

c) Local level training progrmames

This institute organizes the national level workshops and these workshops are conducted at training

institutes in Colombo and outstations. Provincial level training programmes are organized by the

Provincial Management Development Training Units with the facilitation of the SLILG. Local level

training programmes are organized by the respective local authorities with the support of the

institute.

Among the training programmes, the priority was given to train the Newly Elected Members to the

Local Authorities by the Local Government Election held in March 2006. As the first phase, all the

Elected Members were called for one day awareness programmes at district level. After that two day

residential workshops on “skills development” were conducted for Chairman/Vice Chairman and

opposition leaders. The support extended by the Provincial Management Development and

Training Units is conducting these programmes is appreciated.

A list of training programmes conducted within the year is given below:-

SERIAL

NO. WORKSHOP/TRAINING PROGRAMME

NO. OF

WORKSHOPS/

TRAINING

PROGRAMMES

TARGET GROUP

01 Awareness for Chairman & Staff Officers of

Newly Created Local Authorities 01

Heads of Local Authorities and

Staff Officers Newly Created Local

Authorities

02 National Workshops on Local Governance 01 All Mayors, Chairman of Local

Authorities elected in year 2006

03 Training on Institutional Administration 03 Staff officers of Local Authorities

04 Training of Newly Elected Members of Local

Authorities 08

Newly Elected Members of Local

Authorities

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Special Activities

1. Human Resource division of SLILG wishes to place in the records that, it was able to conduct

the Local Government Management Competition for 2003, 2004 which was very

outstanding for more than 02 years. This competition was successfully conducted and held

the prize awarding ceremony with mass scale exhibitions at BMICH.

2. During 2006, SLILG Human Resource Development division was able to give a foreign

exposure to selected, officials and elected members of local authorities. They were sent to

Kerala Institute in India for 7 days, in 3 batches.

In addition, the members of Management Development Training Unit (MDTU) including

Deputy Chief Secretaries (Training) were also given the same opportunity.

3. A Certificate Course in English for Elected Members and Officers were successfully

commenced during 2006. Human Resource division was able to fulfill this gap which is a

highly demanded course in Local Government sector.

Engineering

The trainings and allied activities performed by the Engineering Division which is headed by

Consultant (Engineering) during the year are given below. The activities in this division were

launched in 03 sections.

1. Skills developments and knowledge enhancement of Technical Officers attached to Local

Authorities.

2. Training programmes conducted under sponsorships of other organizations.

3. Programme designed for updating of knowledge and skills enhancement of Engineers

attached to Provincial Councils.

Major disciplines covered are (for Local Authority TOs/SWs)

The Acts, Ordinances, Rules, Regulations and By-Laws relevant to Technical Officers of

Local Authorities.

Building Construction and Maintenance

Road Construction and Maintenance

Water Supply and Drainage

Solid Waste Management and Garbage Disposal

Vehicles and Heavy Equipment Maintenance

Project Planning and Implementation

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Major disciplines covered are (for Provincial Council Engineers)

General Administration.

Contract Administration

Tender Procedures

Devolution Process

Major disciplines covered for Technical related other staff

Contract Administration.

SERIAL


NO. OF

WORKSHOPS/

TRAINING

PROGRAMMES

TARGET GROUP

01 Provincial Training Programme

1.1. Provincial Engineers 01 Provincial Engineers of NCP

02

Local Authority Programme

2.1. Technical Officers

2.2. Newly Recruited TOs

2.3. Superintendent of Work and TOs

2.4. Technical subject related Management

Assistants.

04

04

02

03

Technical Officers &

Superintendent of Work in local

authorities

03 Development of a Publication on “Contract

Administration” 03

All TOs & SW, Management

Assistant of Local Authorities

Special Activities

1. A project proposal was submitted to North East Provincial Council on their request on

“Strengthening of Regional Assistant Commissions of Local Government Offices in North

Eastern Province”. This proposal was accepted and implemented in 03 R/ACLG Offices in

2006.

2. An Impact Assessment was carried out targeting Local Authorities in Western Province to

asses the impact of training conducted for Technical Officers in Local Authorities by

Engineering division of our Institute.

2.1. It was able to publish a book on Contract Administration and printed 1000 copies.

This was a long felt need and targeted all Technical Staff and Technical Relevant Staff

of Local Authorities including Secretaries and Management Assistants as well.

2.2. SLILG had to go for a reprinting of Technical Officers, handbook in order to meet the

increasing demand. 500 copies were printed.

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3. Engineering division of Sri Lanka Institute of Local Governance also submitted a project

proposal on development of Tsunami affected Local Authorities in Southern & Eastern

Provinces to the German Embassy in Colombo.

General Management

The training and consultancy activities performed by the General Management division, which is

headed by Consultant (General Management) is given below. SLILG was successful in obtaining the

assistance of UN-HABITAT to implement several Management programmes for the year 2002.

With the funds provided by them, studies were conducted at several Local Authorities, namely

Negombo, Wattala/Mabola, Kolonnawa, Panadura and Moratuwa to identify the future needs in

Management of Local Authorities.

As a result, Tool Kits that had been developed by UN-Habitat based on their work experience in

other countries were modified to suit the local requirements.

As a further step towards systematic development of training programmes, based on the above

studies, twelve Management modules are in the process of being developed.

These are : Management Information System

Conflict Resolution

Motivation

Action Planning

Social Mobilization

Project Management

Communication

Productivity Improvement

Group Dynamics

Organization Development

Monitoring and Evaluation

Effective Meetings

These Modules will be used as guidelines to implement training programmes next year.

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Several National and Provincial Workshops were conducted by the Management division during

this year in addition to participating and contributing at City Consultations held by Sri

Jayawardanepura Kotte Municipal Councils, Negombo Municipal Councils and Kolonnawa Urban

Council.

National workshop on “Empowerment of Local Authorities with Civil Society Participation”, “Good

Governance” and “Budgeting” proved very successful.

At provincial level, in addition to the Management programmes conducted by the MDTUs with our

approval and participation, SLILG also conducted a programme on “Project Planning” in the North

Central Province.

The Consultant (General Management) also has participated at several seminars conducted by other

Ministries and Institutions as resource person in addition to representing SLILG in the “Urban

Governance Facilitation Committee” chaired by the Secretary to the Ministry of Housing and

Plantation Infrastructure and in the National Task Force on Corporate Governance set up by the

Commonwealth Secretariat.

SERIAL


NO. OF

WORKSHOPS/

TRAINING

PROGRAMMES

TARGET GROUP

01 Action Planning 01 Staff Officers

02 Training of Trainers 01 Senior Staff Officers

03 Management Information Systems 01 Senior Staff Officers 04 Effective Meetings 01 Senior Staff Officers

05 Motivation 01 Senior Staff Officers 06 Project Proposal Writing 01 Senior Staff Officers 07 Time Management 03 Senior Staff Officers 08 Training Methodology 01 Senior Staff Officers 09 Office Management 03 Senior Staff Officers 10 Social Mobilization 01 Senior Staff Officers 11 Conflict Resolution 01 Senior Staff Officers

12 Management Information for Local

Environment (Final Workshop) 01

Mayors, Elected Members and

Officials

13 Geographical Information System 01 Senior Staff Officers

14 Strategic Management (Parallel Thinking) 01 District Secretaries

Divisional Secretaries

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Physical Planning

The main objective of the division is Capacity Building through Awareness, Training and

Consultancy Services to relevant officials and peoples’ representatives of Provincial Councils and

Local Authorities in Sri Lanka. With this improvement or their knowledge, attitudes and skills will

help to provide better service to the people on physical planning activities thereby providing better

living environment for the inhabitant and community population of the relevant Local Authorities.

SERIAL


NO. OF

WORKSHOPS/

TRAINING

PROGRAMMES

TARGET GROUP

01

Physical Planning Training Programme

for newly recruited graduates

03 Newly Recruited Graduates

02

Training Programme for Development

Officers

01 Development Officers

03

Awareness Programme on Training

Programmes

02 Staff Officers of Local

Authorities

04

Physical Planning Training Programme

on Project Assistant

01

Field Officers

05

Impact Assessment

01 Staff Officers

06

Awareness Programme on Physical

Planning

06 Staff Officers of Local

Authorities

NOTE: * In the Action Plan No. 01 and No. 04, programmes were conducted jointly as requested

by most of the officials to conduct this awareness programme together with elected members rather

than conducting separately as it will be advantageous.

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Research and Publications

This division deals with the following areas at present,

Undertake and promote research studies in areas of urban / local development and problems

of local authorities to improve and develop their capacities.

Dissemination of Research findings among relevant policy makers and implementers.

International Workshop

Seminars

Governance Journal

News Letter

Other Publications

Network with National and International Research Organizations in the area of governance.

To unearth areas of importance for new research initiatives.

Set up Database for Provincial Councils and Local Authorities

Publication of Journals/ News Bulletins

Documentation of Research Outputs and studies on focused areas

Manuals and Hand Books

Provisions of Library Services

Training Programmes

Conducting Workshops on Research Methodology

Programme on preparation of Maps for Local Authorities

Under this programme SLILG has prepared maps for 215 local authorities in Sri Lanka

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SUBJECT AREA PROGRAMME

NO. OF RESEARCH

STUDIES, WORKSHOPS,

NO. OF PUBLICATIONS

TARGET GROUPS

Research

Research study on staff

development in local

authorities

01 Local Authorities in Sri

Lanka

Research

Research study on

preparation and

implementation of By-Laws


Lanka

Training Programme

Workshop on Research

Methodology 01

Officers of Provincial

Councils

Training Programme

National Workshop on

Local Government News 01 Officers of Local Authorities

Hand Book

Publish the Work

Procedure for Local

Authorities (Tamil &

English)


Lanka

Translations

Translation of the Training

Manual on Elected Women

Representatives in Local

Government in to Tamil

and English

01

Provincial Councils and

Local Authorities in Sri

Lanka

Journal

Governance Journal 01



Lanka

News Letters

“Palath Palana Puwath” 03 issues Local Authorities in Sri

Lanka

Library Development

Library Development - -

Preparation of Maps for

Local Authorities

Preparation of Maps for

Local Authorities 150* 03 Maps



Lanka

Sale of Publications Sale of Publications 1020 books



Lanka

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Financial Management

SERIAL


NO. OF

WORKSHOPS/

TRAINING

PROGRAMMES

TARGET GROUP

01

Improvement of Financial Management

Capacity

01

All staff attached to Accounts

division of Southern Province

Local Authorities

02


Capacity

01


division of Sabaragamuwa

Province Local Authorities

03


Capacity

01


division of Central Province

Local Authorities

04


Capacity

01


division of Uva Province Local

Authorities

05


Capacity

01


division of North Central


06


Capacity

01


division of North Western


07


Capacity

01


division of North East Province

Local Authorities

08

Preparation of Financial Accounts

02


division of Eastern Province

Local Authorities

09

Conducting Diploma on Local

Government Financial Management

01

Local Authority Secretaries,

Officers of Financial Divisions,

Staff Officers and field Officers

of Local Authorities

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SRI LANKA INSTITUTE OF LOCAL GOVERNANCE

7.0. STATEMENT OF FINANCIAL PERFORMANCE

For the year ended 31st December 2006

Notes

31/12/2006

31/12/2005

Operating Revenue

Government Contribution - Recurrent 01

19,246,118

13,902,000

Other Income 02

10,853,093

372,752

Total Operating Revenue

30,099,211

14,274,752

Operating Expenses

Administration & Establishment Expenses 03

14,786,872

11,729,456

Human Resources Development Expenses 04

8,578,356

2,456,304

Project Expenses 05

8,282,026

-

Provisions 06

1,310,551

1,233,334

Total Operating Expenses

32,957,805

15,419,095

Surplus / Deficit

- 2,858,594

- 1,144,343

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8.0. STATEMENT OF FINANCIAL POSITION

As at 31st December 2006

Notes

31/12/2006

31/12/2005

ASSETS

Non-Current Assets

Property, Plant & Equipment 07

17,085,134

17,927,773

Current Assets

Stocks 08

1,317,140

1,080,886

Pre - Payments & Receivables 09

319,157

1,283,978

Staff Debtors & Advances 10

6,084,031

5,227,954

Advances - Others 11

68,600

68,600

Cash and Cash Equivalents 12

960,342

129,725

8,749,270

7,791,142

Total Assets

25,834,404

25,718,915

EQUITY & LIABILITIES

Government Contribution - Capital

18,939,228

18,618,942

Accumulated Fund

- 1,273,865

1,464,684

UNDP Grant

714,659

520,833

Grant From Hon. M.W. Deen of Maldives

1,014,923

-

Projects Contribution - Capital

1,595,825

1,595,825

20,990,769

22,200,284

Non Current Liabilities

Staff Welfare fund 13

1,698,590

1,698,590

Retirement Benefit Obligations 14

931,389

621,389

2,629,978

2,319,978

Current Liabilities

Provisions - Audit Fees

100,000

60,000

Creditors & Accrued Charges 15

2,113,656

1,138,653

2,213,656

1,198,653

25,834,404

25,718,915

0.00

- 0.00

Accountant

SLILG

Director

SLILG Chairman

SLILG

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9.0. CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31st December. 2006

31/12/2006

31/12/2005

CASH FLOWS FROM OPERATING ACTIVITIES

Surplus /(Deficit) from ordinary activities

(2,858,594)

(1,144,343)

Adjustments for Non - Cash Movements

Loss from Disposal & transfer of Property

262,089

Depreciation

960,551

1,075,718

Provisions - Gratuity

310,000

134,600

Provisions - Audit Fees

40,000

23,017

Operating Surplus before working capital changes (1,285,954)

88,991

(Increase) / Decrease in Inventories / Debtors / Other Receivables (127,510)

(1,493,762)

Increase / (Decrease) in Creditors / Payables

975,002

138,209

Cash Generated from Operations

(438,461)

(1,266,562)

Gratuity Paid

-

(63,211)

Audit Fees Paid

-

(33,017)

Net cash from operating activities

(438,461)

(1,362,791)

CASH FLOWS FROM INVESTING ACTIVITIES

Acquisition of Property

(273,344)

(851,750)

Proceeds from Disposal

60,431

Prior year Adjustment

-

(330,400)

Net Cash Flows from Investing Activities

(651,374)

(2,544,940)

CASH FLOWS FROM FINANCING ACTIVITIES

Capital Grant

1,481,991

250,000

Net movement During the year

830,617

(2,294,940)

Cash & Cash Equivalents at the beginning of period 129,725

2,424,666

Cash & Cash Equivalents at the end of Period Note

'A' 960,342

129,725

Note 'A'

Cash at Bank

960,342

129,725

Cash in Hand

-

-

Bank Overdraft

-

-

960,342

129,725

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10.0. STATEMENT OF CHANGES IN NET ASSETS

For the year ended 31st December 2006

Description Government

Contribution

Capital

Accumulated

Fund

UNDP

Grant

TOTAL

Rs.

Rs.

Rs.

Rs.

Balance as at 01/01/2006 18,618,942

1,584,729

520,833

20,724,504 Surplus / Deficit for the

period -

- 2,858,594

-

- 2,858,594

Capital Grant for the period 320,286

-

193,825

514,111

Balance as at 31/12/2006 18,939,228

- 1,273,865

714,659

18,380,022

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11.0. ACCOUNTING POLICIES

1. GENERAL ACCOUNTING POLICIES

1.1. Financial Statements of the institute are prepared in accordance with generally

accepted accounting principles on a historical cost basis.

1.2. No adjustments had been made for inflationary factors affecting the accounts in the

primary financial statements.

2. ASSETS AND BASIS OF THEIR VALUATION

2.1. Fixed Assets are normally valued at cost.

2.2. Certain Assets had been transferred from Ministry of Provincial Councils and Local

Government without any cost. As per the information available the said assets were

purchased before 1995. Therefore, they were treated as fully depreciated but decided

to shown in record with a residual value of Rs. 100/- per each.

2.3. Among the items transferred from the Ministry of Local Government & Provincial

Councils certain items were appeared immaterial in pricing. A decision was taken to

continue these items only on quantity basis in records without a valuation.

2.4. Depreciation is not provided in the year of acquisition or commissioning.

2.5. Depreciation is charged on all assets on a straight-line basis.

2.6. For the purpose of depreciations, the effective life time assets are as given below.

CATEGORY OF ASSETS LIFE TIME

YEARS

DEPRECIATION

RATE

a) Machinery and Office Equipment 10 10%

b) Computers and allied Accessories 05 20%

c) Vehicles 05 20%

d) Leasehold Lands 50 02%

e) Library Books 10 10%

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3. LIABILITIES AND PROVISIONS

3.1. Terminal Benefits

A provision of Rs. 931,388.50 had been made in the Accounts for terminal benefits

under the Gratuity Act. No. 12 of 1983 and this had been grouped under non-current

liabilities in the Balance Sheet.

3.2. Workmen Compensation

A Workmen Compensation Insurance Fund is not in operation.

4. CAPITAL EXPENDITURE

Expenditure incurred for the purpose of acquiring, extending or improving assets of a

permanent nature by means of which to carry on the objectives or for the purpose of

increasing the earning capacity has been treated as Capital Expenditure.

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12.0. NOTES TO THE ACCOUNTS


31/12/2006

31/12/2005

Note 01 - Government Contribution - Recurrent :-

2100 - 02 General Treasury

15,432,757

13,902,000

2100 - 06 Ministry of PC. & LG

3,813,361

-

Total

19,246,118

13,902,000

Note 02 - Other Income :-

1505 - 01 Miscellaneous Income

196,578

30,726

1505 - 02 Interest on Loan to Employees

217,305

1,573

1505 - 03 Sales of Publication

169,338

116,953

1505 - 04 Insurance Claims

40,451

-

1505 - 05 Sales of Map

245,707

223,500

2101 - 01 Project Income

8,624,714

-

2101 - 02 English Certificate Course

769,000

-

2101 - 03 Diploma In Local Government Financial Management (DLGFM) 590,000

-

Total

10,853,093

372,752

Note 03 - Administration & Establishment Expenses :-

1503 - 01 - 01 Personal Emoluments - Salaries & Wages 7,226,336

5,678,969

1503 - 01 - 02 Personal Emoluments - E. P.F

840,807

630,493

1503 - 01 - 03 Personal Emoluments - E. T.F

216,017

158,598

1503 - 01 - 04 Personal Emoluments - Holiday Payments & O.T 299,971

186,826

1503 - 01 - 05 Personal Emoluments - Other Allowance 358,150

130,368

1503 - 02 - 01 Travelling Expenses - Local

122,813

128,090

1503 - 03 - 01 Supplies - Stationary

612,662

434,398

1503 - 03 - 02 Supplies - Fuel Lubricants

1,137,561

710,446

1503 - 03 - 03 Supplies - Uniform 14,617

19,654

1503 - 04 - 01 Maintenance Expenses - Vehicles

801,830

1,046,587

1503 - 04 - 02 Maintenance Expenses - Plant, Machinery & Equ. 201,358

200,157

1503 - 04 - 03 Maintenance Expenses - Building

980,313

700,787

1503 - 05 - 02 Contractual Services - Telephone

686,796

532,767

1503 - 05 - 03 Contractual Services - Postal Charges 46,600

11,351

1503 - 05 - 04 Contractual Services - Water & Electricity 458,209

347,697

1503 - 05 - 05 Contractual Services - Newspapers & Periodicals 146,006

12,330

28

1503 - 05 - 06 Contractual Services - Security Service 212,814

264,489

1503 - 05 - 07 Contractual Services - Others

424,014

535,450

Total

14,786,872

11,729,456

Note 04 - Human Resources Development Expenses :-

2201 - 05 - 01 H.R.D Expenses - National Level Training Programme 7,621,787

1,640,877

2201 - 05 - 02 H.R.D Expenses - Provincial Level Training Programme - 283,962

2201 - 05 - 03 H.R.D Expenses - Capacity Building of SLILG 612,965 385,110

2201 - 05 - 04 H.R.D Expenses - Research, Library & Publications 343,605 146,355

Total

8,578,356

2,456,304

Note 05 - Project Expenses :-

1504 - 01 Projects Expenses

8,156,221 -

1503 - 06 - 01 Map Expenses

125,805 -

Total

8,282,026

-

Note 06 - Provisions :-

2102 - 01 Provisions - Gratuity

310,000

134,600

2102 - 02 Provisions - Audit Fees

40,000

23,017

2105 - 02 Depreciation - Machinery & Office Equipment 646,322

773,493

2201 - 03 Depreciation - Library Books

12,005

-

2105 - 04 Depreciation - Leasehold Land

302,225

302,225

Total

1,310,551

1,233,334


13.0. NOTES TO THE ACCOUNTS


31/12/2006

31/12/2005

29


NOTES TO ACCOUNTS


Note 07 - Property, Plant & Equipment :-

Cost as at

01/01/2006

Transfer

2006

Additions

2006

Removals

2006

Depreciation

2006

Accumulated

Depreciation

W.D.V. as at

31/12/2006

W.D.V. as at

31/12/2005

2201 - 01 Vehicles 400 - - 100 - - 300 400

2201 - 02 Machinery & Office

Equipment 6,793,527 3,078,151 254,880 734,501 646,322 6,033,740 3,358,317 4,025,034

2201 - 03 Library Books 120,045 - 18,363 - 12,005 12,005 126,404 -

2201 - 04 Leasehold Land 15,111,237 - - - 302,225 1,511,124 13,600,114 13,902,338

Total

22,025,210

3,078,151

273,243

734,601 960,551

7,556,868

17,085,134

17,927,773

30

Note 08 - Stocks :-

2202 - 01 Stocks

131,057

244,353

2202 - 02 Stocks - Publication

1,186,084

836,533

Total

1,317,140

1,080,886

Note 09 - Pre - Payments & Receivables :-

2206 - 01 Pre - Payments - Insurance

61,344

13,020

2206 - 02 Pre - Payments - Rent, Post Master General & Others 207,813

185,112

2206 - 04 Receivable Account - Project - SCP

50,000

368,200

Receivable Account - Project - MILES -

717,646

Total

319,157

1,283,978

Note - 10 - Staff Debtors & Advance :-

2204 - 04 Festival Advance

23,900

19,700

2204 - 05 Staff Loan

6,060,131

5,208,254

Total

6,084,031

5,227,954

Note - 11 - Advances - Others :-

2205 - 04 Advance to Foreign Travels

68,600

68,600

Note - 12 - Cash and Cash Equivalents :-

2207 - 02 Bank of Ceylon - A/C No. 2323344

147,416

72,113

2207 - 03 Bank of Ceylon - A/C No. 2323350

159,553

55,290

2207 - 04 Servings Account - Bank of Ceylon - A/C No. 2329975 653,372

2,321

Total

960,342

129,725


NOTES TO THE ACCOUNTS


31/12/2006

31/12/2005

31

Note - 13 - Staff Welfare Fund :-

Balance as at 01/01/2006

1,698,590

1,497,247

Transfer During the Period

-

201,342


1,698,590

1,698,590

Note - 14 - Retirement Benefit Obligations :-


621,389

550,000

Provisions During the Period

310,000

134,600

Actual Amount Paid

-

-

63,211


931,389

621,389

Note - 15 - Creditors & Accrued Charges :-

2103 - 01 Accrued Charges

2,057,406

1,082,403

2104 - 02 Deposits - Tender

56,250

56,250

Total

2,113,656

1,138,653


NOTES TO THE ACCOUNTS


31/12/2006

31/12/2005

32

33

34

35

36

Documents

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