PA says no understating of profits, manipulation of accounts by RPCs

The Planters' Association [PA] of Ceylon, responding to a recent media report, refuted the allegation that Regional Plantation Companies [RPCs] are deliberately understating their profits.

The PA, the representative body of the RPCs, said any assumptions or claims that RPCs are understating their profits, manipulating their asset values, or misrepresenting their accounts, are totally unfounded.

"The PA strongly objects to any allegations that RPCs are understating their profits. The idea that RPCs can understate their profits, or manipulate their accounts, for any reason, is a complete fallacy. They cannot do that because of very strict auditing and monitoring processes. The RPC accounts are also available to the public if anyone wants to examine them," said the Chairman of the PA, Lalith Obeyesekera.

The PA points out that most RPCS are public quoted companies, governed by the regulations of the Securities and Exchange Commission and are also subject to the Companies Act. Financial statements and accounts of listed RPCs are audited and published at the Colombo Stock Exchange and are totally transparent, it said.

The preparation and publication of accounts are in accordance with the Sri Lanka Accounting Standards and Best Practices. The Board of Directors of the companies are held accountable for the published financial statements. These Boards of Directors also comprise a minimum number of independent directors, whose responsibility includes ensuring that the company accounts are presented in accordance with generally accepted accounting principles, practices and rules adopted by the Institute of Chartered Accountants of Sri Lanka.

The different levels of profits and performance among the different RPCs, said the PA, are due mainly to the composition of crops in each company, and not due to any RPCs understating their profits or misrepresenting their accounts. RPCs with a larger share of rubber and oil palm are currently performing better due to the global price increases of these crops. The reverse may be seen in the case of companies with larger extents of other crops.

The PA says there is also no deliberate manipulation of asset value of plantation companies. The RPCs have followed the original valuation of assets, as set by the government valuation, at the time plantation companies were handed over to them, said the PA.

Action has been taken to address the subject of uncultivated lands in RPC estates, if any. The plantation companies have already submitted, to the Ministry of Plantation Industries, proposals on development plans for any such lands, said the PA.