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CMA Sri Lanka SL4 Corporate Governance & Ethics Exam study materials
CMA Sri Lanka SL4 Corporate Governance & Ethics Exam study resources

CMA Sri Lanka SL4 Corporate Governance & Ethics Exam: Governance and Ethics in the Sri Lankan Regulatory Context

CMA Sri Lanka SL4 Corporate Governance & Ethics Exam · Work through your exam, one topic at a time.

All guide sections

Governance and Ethics in the Sri Lankan Regulatory Context

This domain tests whether you know which Sri Lankan institution does what, which instrument is legally binding, and how the layers interact for a listed company.

The institutions

  • Registrar of Companies administers the Companies Act No. 7 of 2007.
  • Securities and Exchange Commission of Sri Lanka (SEC) regulates the market under the Securities and Exchange Commission of Sri Lanka Act No. 36 of 2021, which replaced the 1987 Act and strengthened licensing, market conduct and enforcement powers.
  • Colombo Stock Exchange (CSE) operates the market and enforces its Listing Rules, including the corporate governance requirements in Section 7.10.
  • CA Sri Lanka issues accounting and auditing standards and the Code of Ethics, and jointly with the SEC publishes the Code of Best Practice on Corporate Governance 2017.
  • Central Bank of Sri Lanka supervises banks, insurers and non-bank financial institutions under its own governance requirements.
  • CIABOC enforces bribery and corruption law, including the Anti-Corruption Act No. 9 of 2023.

The hierarchy

Statute binds everyone. CSE Listing Rules are mandatory for listed entities. The Code of Best Practice is principles-based and reported on a comply-or-explain basis. Companies then layer their own charters and codes on top. State-owned enterprises follow separate government governance guidelines and ministerial oversight.

Worked example

A listed company has eight directors, only two of them independent, and includes the CEO on its audit committee. Both are mandatory listing rule failures, not matters for explanation. The board should remedy composition within the permitted cure period, disclose the change, and record the audit committee reconstitution.

Traps that cost marks

Treating the Code of Best Practice as statute. Assuming the Companies Act sets listed-company board composition. Confusing the SEC with the CSE. Ignoring the sector regulator for banks and insurers. Forgetting that the 2021 SEC Act replaced the 1987 Act.