Sri Lanka’s provision of inaccurate data comes under IMF scrutiny

• The Executive Board reviewed a report from the Managing Director on the inadvertent provision of inaccurate data by Sri Lanka on the ceiling of the central government’s stock of expenditure arrears

The government's provision of inaccurate data to the International Monetary Fund (IMF) has come under review by its Executive Board. 

The Executive Board reviewed a report from the Managing Director on the inadvertent provision of inaccurate data by Sri Lanka on the ceiling of the central government’s stock of expenditure arrears, according to the IMF.

The under-reporting of the arrears stock identified through a detailed analysis of budget line appropriations gave rise to noncomplying urchases and a breach of Sri Lanka’s obligations under Article VIII, Section 5. The authorities have worked openly and closely with IMF staff to provide corrected data and have undertaken several corrective 1 SDR figures are converted at the market rate of U.S. dollar per SDR, it said.

“The inaccuracies in information provided to the IMF were inadvertent and arose because of weaknesses in the timely reporting of arrears by line ministries to the Ministry of Finance, as well as a misunderstanding by the authorities of the definition of “arrears” under the Technical Memorandum of Understanding. 

“The Executive Board positively considered the authorities’ corrective actions, the fact that arrears repayments will be accommodated within the existing fiscal envelope, and the authorities’ commitment to improving public financial management procedures in line with the new PFM law, to reduce the risk of accruing arrears or inaccurate reporting of information going forward. 

In view of the above, the Executive Board agreed to grant waivers for the non observances of the quantitative performance criterion that gave rise to the noncomplying purchases and decided not to require further action in connection with the breach of obligations under Article VIII, Section 5, Kenji Okamura, Deputy Managing Director  and Acting Chair, said in a statement.