COLOMBO, Sri Lanka – 04 September 2026 – PMF Finance PLC has announced that its Independent Auditor’s Report for the financial year ended 31 March 2026 includes a qualified audit opinion. The corporate disclosure, made to the Colombo Stock Exchange (CSE) on September 4, 2026, details the specific grounds for the qualification and the company’s plan to address the identified issues.
The announcement, a critical update for stakeholders in the Sri Lankan finance sector, comes as PMF Finance PLC navigates its financial reporting obligations under CSE Listing Rules.
Basis for the Qualified Opinion
According to the disclosure, the independent auditors highlighted several key areas contributing to their qualified opinion. These include:
- Margin Trading Portfolio Discrepancy: An unreconciled difference of LKR 51.4 million was identified as at 31 March 2026 between the margin trading portfolio balance and the corresponding general ledger balance. While management initiated a partial reconciliation and recorded adjustments, auditors were unable to obtain sufficient appropriate audit evidence regarding the completeness and accuracy of this partial reconciliation.
- Unverified Other Assets: Auditors were unable to obtain sufficient appropriate audit evidence to verify the existence, accuracy, and recoverability of LKR 12.7 million initially recognized within other assets. A provision was subsequently recorded against this amount by management.
- Other Liabilities Concern: The completeness and accuracy of an amount of LKR 10.4 million recognized within other liabilities could not be sufficiently verified.
- Manual Journal Entries: Audit procedures considered necessary in respect of manual journal entries recorded by management could not be completed, preventing auditors from determining if any adjustments were required for these entries and balances in the financial statements.
Quantified Financial Impact and Management’s View
PMF Finance PLC has quantified the cumulative impact of the audit qualification on its financial statements. The percentages, calculated by comparing reported balances, are as follows:
- Impact on profit before tax: 5.39%
- Impact on net assets: 1.02%
- Impact on total assets: 0.15%
- Impact on total income: 0.68%
- Impact on earnings per share: 3.19%
Despite these figures, the Board of Directors and Management of PMF Finance PLC are of the view that the overall impact of these qualifications is not material in relation to the company’s size and its overall financial position. This assessment aims to reassure investors regarding the company’s fundamental stability.
Resolution Pathway
To address the audit findings, PMF Finance PLC has outlined a clear resolution strategy. The company has already made appropriate provisions for the balances referred to in the audit qualification, noting that these balances primarily relate to prior financial years. The resulting financial impact has been recognized in the Statement of Profit or Loss for the financial year 2025/2026.
Furthermore, PMF Finance PLC intends to resolve the underlying issues through an independent audit. The company anticipates that this comprehensive process will be completed within the next six months. It has also affirmed its commitment to proceeding with the resolution process in strict accordance with the Listing Rules of the Colombo Stock Exchange, reinforcing its dedication to regulatory compliance and transparency.
This proactive approach from PMF Finance PLC underscores its commitment to maintaining robust financial governance and restoring full auditor confidence moving forward. The company’s progress on these resolutions will be closely watched by the market and its stakeholders.
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