SLAASMB flags persistent gaps in financial reporting compliance in 2024

THE Sri Lanka Accounting and Auditing Standards Monitoring Board (SLAASMB) has reported that while overall compliance with Sri Lanka Accounting Standards (LKAS) remained broadly stable in 2024, nearly half of the financial statements reviewed required improvements, underscoring ongoing weaknesses in disclosure quality and accounting judgments across sectors.

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According to its Regulatory Activity Report 2024, the SLAASMB reviewed 388 sets of financial statements relating to 381 economically significant Specified Business Enterprises (SBEs) from the public and private sectors, a sharp increase from 261 reviews in 2023 following additional supervisory recruitment.

Around 62% of the financial statements reviewed during the year comprised of regulated entities and the balance represented economically significant private entities.

Of the 388 financial reports reviewed, 51% were fully compliant with applicable standards, while 49% required improvements. No cases warranted enforcement action for significant non-compliance.

The regulator identified recurring deficiencies in several core areas of annual reporting.