KPMG audit finds losses at CPC and CPSTL due to data manipulation

By Chaturanga Pradeep Samarawickrama
KPMG’s forensic audit on irregularities at Ceylon Petroleum Corporation (CPC) and Ceylon Petroleum Storage Terminals (CPSTL) has revealed substantial losses attributed due to alterations and deletions in SAP data related to stock holdings.
In response to a complaint filed by the Power and Energy Minister with the Criminal Investigations Department (CID) in August 2022, a forensic audit was initiated.
The major findings of the audit, conducted by KPMG on the sales and distribution of petroleum products from CPSTL, were briefed to Power and Energy Minister Kanchana Wijesekera yesterday afternoon.

KPMG and CPSTL audit investigation officials have found that more than 1.3 million entries in SAP data had been changed or deleted since 2010, with most occurring in 2022 during the height of the fuel crisis.
After the complaint was lodged in August 2022, the number of alterations significantly reduced in 2023.
Massive losses were recorded from stock holdings in 2022, amounting to Rs 28 billion. After the complaint was lodged, the losses had decreased to Rs. 4 billion in 2023.
The use of outdated circulars and procedures, along with inadequate data, made it difficult to determine certain irregularities.
The full report on the major findings of the forensic audit conducted by KPMG will be handed over next week. The minister will then present the complete report to the CID for further investigations to take appropriate legal action.

The report will also be shared with Cabinet Ministers, parliament, Auditor General, and the Attorney General’s Department to pursue the next steps.