Page 112 - CA Sri Lanka Integrated Annual Report 2023

NOTES TO THE FINANCIAL STATEMENTS

26 EVENTS OCCURRING AFTER THE REPORTING PERIOD
There are no material events occurring after the reporting period that require adjustment or disclosure in the financial statements.

27 COMMITMENTS
There are no material capital commitments as at reporting date.

Bank Guarantees
The following bank guarantees have been provided as at 31 December 2023.
1 The Institute has submitted a bank guarantee amounting to Rs. 16.32 Mn through Bank of Ceylon to the Tax Appeals Commission for VAT
assessments for the period commencing from 01 April 2012 to 31 December 2014.
2 A bank guarantee amounting to Rs. 24.83 Mn had been submitted by the Institute to the Tax Appeals Commission through Bank of Ceylon
for NBT assessments for the period commencing from 01 July 2009 to 31 December 2014. This guarantee has been executed by Inland
Revenue Department on 18.12.2023 and it is shown under Other Receivables in these Financial Statements, pending the finalization of tax
liabilities, if any.
3 The Institute had submitted another bank guarantee amounting to Rs. 1.1 Mn through Bank of Ceylon to the Tax Appeals Commission for
ESC assessments for the period commencing on 01 April 2009 to 31 March 2012. This guarantee has been executed by Inland Revenue
Department on 23.10.2023 and it is shown under Other Receivables in these Financial Statements, pending the finalization of tax liabilities,
if any.

28 CONTINGENT LIABILITIES
The Institute had received assessments in respect of Value Added Tax (VAT) for the period commencing from 01 April 2012 to 31 December
2014 amounting to Rs. 61 Mn and Nation Building Tax (NBT) for the period commencing from 01 July 2009 to 31 December 2014 amounting to
Rs. 100 Mn. Further, the Institute had also received an assessment in respect of Economic Service Charge (ESC) for the period commencing
from 01 April 2009 to 31 March 2012 amounting to Rs. 4.5 Mn. The Institute had duly appealed to the Tax Appeals Commission (TAC) against all
the determinations of the Commissioner General of Inland Revenue (CGIR) in respect of above assessments.
TAC has determined appeals against the assessments for ESC in favour of the CGIR and the case has now been stated to the Court of Appeal.

TAC has also determined appeals against the assessments for VAT and NBT in favour of the CGIR. The Institute is currently awaiting the case
stated from TAC to make an application to the Court of Appeal.
Having discussed with independent legal and tax experts and based on information available, the Institute is of the view that it is not liable for
assessed taxes in the above assessments and therefore, no provision has been made in the financial statements.

110 CA Sri Lanka Integrated Annual Report 2023