Excessive Commission Payments Made by Lanka Mineral Oil Corporation: Report Reveals
According to a report issued by the National Audit Office, Lanka Mineral Oil Corporation (LMOC) has overpaid distributors by a sum of Rs. 31.021 billion (Rs. 31,021 million) as commissions for the year ending April 30, 2023. This amount exceeds the approved commission rates and is detailed in the audit report for the previous financial year.
The report highlights that the corporation’s payments to distributors were affected by fluctuations in local petroleum product prices, leading to potentially harmful consequences for both the distributors and the corporation. To mitigate these effects, the corporation implemented a decision to set upper and lower limits for commission payments, as per the Director Board’s decision of July 30, 2019, numbered 05/1231.
However, despite this directive, distributors were still paid commissions beyond the upper limit during the year in question. The excessive commission amount for 2023 stands at Rs. 14.874 billion (approximately Rs. 14.9 billion). These commission payments are part of the overall distribution and sales costs, which contributed to the final sum.
The audit report issued for the year 2023 regarding Lanka Mineral Oil Corporation contains this and other financial details, shedding light on significant discrepancies in their commission payments.
