Special Audit conducted at Mount Vernon Estate on 7th and 8th March 2022
12th April,2022,
Kotagala Plantations PLC,
53/1/1, Sir, Baron Jayatilake Mawatha,
Colombo-01
Dear Sir,
Special Audit conducted at Mount Vernon Estate on 7th and 8th March 2022
I am in receipt of the Audit report in connection to the above-mentioned Audit conducted by Mr. Dinesh Perera and his team.
In response to your email dated 24th April 2022, I give below my comments with regard to the observations mentioned in the Audit report.
1. I confirm the position in paragraph -1 of the report under the heading introduction to the effect that there were no variances in the Tea Factory stocks as revealed at the stock check taken on 7th March 2022.
2. Referring to paragraph 02 of the Audit report under the subject introduction I totally and categorically deny the position in the Audit report to the effect that a large quantity of Refuse Tea was burning with the Firewood dust. I state that it is not refuse Tea but Factory sweepings (loft cleaning, Rolling Room cleanings, and drier room cleanings) that were dumped in the said area with the Drier ash and charcoal. This particular place had been the dumping ground of drier charcoal, ash, and Factory cleanings for the past 20 years or so at Mount Vernon Estate. Image of dumping area attached.
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3. Referring to the contents in the paragraph - 03 of the Audit report under the heading introduction I totally and categorically deny the position in the Audit report to the effect that I behaved in a disruptive manner which compelled the Audit officers to leave the estate at 2.30PM on the same day. on the contrary, I state that I only made my best and genuine attempts to reason out and to explained to the chief Auditor that he has absorbed a wrong picture to the effect that Refuse Tea is being removed from the Factory for dumping and burning in that area. In fact, it was the Chief Auditor who behaved in a disruptive manner in that place by forcing and compelling me to sign a document stating that the residue founding the dumping are is Refuse Tea whereas it was actually not Refuse Tea but Factory cleanings. His mode of collection of samples was also not in conformity with the accepted standards and when I pointed it out to him he acted in an offensive manner against me. All the Assistant Auditors, The two General Managers ( Mr.Lasantha De Silva and Mr.Tisantha De Silva ) Deputy Manager, Administrative Officer, Senior Assistant Factory Officer, and Assistant Factory officers were presenting that place also very clearly witnessed the biased manner in which the Chief Auditor was behaving.
Further, the Chief Auditor committed an extreme high-handed act by forcibly removing all CCTV camera DVR units in my office without even giving a reason as to why he is committing such an act. He subjected me to humiliation and embarrassment by directing an Assistant Auditor Mr.Wasantha ( who reluctantly obeyed the instructions) to get on top of my Official Table to dismantle the CCTV equipment not even giving the least regard or consideration to the fact that all my subordinates staffs are watching and observing what was happening in that place. Where i treat this official table very sacredly and available with photograph of Lord Jesus Christ on my official table. Further, I firmly believe that the Chief Auditor has no authority what so ever remove an asset fixed in the Mount Vernon Estate office which is under my custody without obtaining my authority or permission.
All the above-mentioned acts committed by the chief Auditor only proves that he is hardoring an ulterior motive to subject me to embarrassment and severe inconvenience. A video clip and Image of the above act is attached.
4. I give my detailed comments in respect of item No-02 in the Audit report under the subheading “Observations”.
04.I) On the 6th March 2022 Factory cleaning operations were in progress and all video footages shown in annex - 03 depict Factory cleanings, and sweepings being carried out of the Factory to be dumped at the dumping area. I categorically deny that it is Refuse Tea as alleged. (video footage /Screen shots are attached from CCTV footage's)
https://drive.google.com/file/d/176U7OyoQdYhUa8Gqoo6zsGPtXCvVhSt2/view?usp=sharing
https://drive.google.com/file/d/17HH1gcpFctcnhiWbv3AFhjKFJK5dMB1r/view?usp=sharing
https://drive.google.com/file/d/17FcrMlMHPX1niAe9VXg59NDuWisL2_DE/view?usp=sharing
https://drive.google.com/file/d/17AGsFOHScSijgqgrIbm_qXrT8AcQ84Xa/view?usp=sharing
https://drive.google.com/file/d/178-Lv-emiWt6Jn3cxA5Oon8wxG-NIoay/view?usp=sharing
II) It is not discarded Refuse Tea, and therefore no necessity arises to maintain records of discarded Factory Cleanings.
III) I iterate that no Refuse Tea
was discarded but the Factory workers were taking out only the Factory cleanings.
This image was extracted from the chief auditor's report. You can easily identify the highlighted area. within one day the fungus started to grow from those sweeping's. This will clearly indicates that these sweepings are over moistured and not suitable for add with refused tea or for human consumption. If the Tea board detects this inside the factory premises, this can lead to cease the factory functions.
IV) This allegation is purely based on a fancy imagination and an illusion of the Chief Audit Officer. I was not aware that the Audit Officers were coming to Mount Vernon Estate on 7th March 2022. I sent my supervisory vehicle to provide transport to Mr.P.A.Bernard to come to the estate because he had to give evidence on behalf of the Company at the Labour Tribunal case at Talawakelle on 8th March, 2022. On 6th March 2022, stock counting in the Factory took place as a matter of routine work at the Factory.
V) This allegation is also stated on a fancy and wild imagination of the Chief Auditor. On 6th March, 2022 we were discarding the cleanings of 3rd, 4th, and 5th, March 2022 thus and accumulated quantity of about 150 kgs of Factory cleanings obtain from the Rolling Room , Drier Room, and the loft ( video footage showing the cleaning process are attached ).
https://drive.google.com/file/d/17W4SD0-BeAHvFd3T-eccv5Kqv5E-dbQC/view?usp=drivesdk
VI) The mixed Firewood 01 Cu.meter in reference had been overused by the
Factory depending on the requirement for manufacture on 05th and 06th March 2022 which is a Sunday. Before the internal order was raised on the following
day to reconcile the stocks the Audit commenced and the
shortage was observed. In any event, before I could probe into the matter the
Audit commend. However in any event I would have taken appropriate action to
recover the cost of the Firewood overspent from the Factory staff who was
in-Charge at the Drier on that day.
With regard to the Rubber Firewood too I wish to inform you this Firewood quantity had been issued on 5th and 6th March 2022 on making the relevant entries in the issues book. Internal order could not be raised because the office was closed on the 5th and 6th March 2022. However, arrangements had been made to complete the documentation work connected to the Rubber Firewood on 7th March 2022 by issuing internal orders. However, the Audit commenced before the internal orders were raised. In any event, the Auditor had made a comment to the effect that these are in order because entries connected to Firewood issues had been made in the issues book (page attached)
Vii) The dumping place of Factory sweepings of Stonyclif estate which is shown in annexure 04 can be seen that it also consist Factory sweepings just like the sweepings dumped by Mount Vernon estate. But they have dumped earth on top of it whereas we have added drier ash and charcoal instead of earth, since we do not have enough space to dump sweepings and drier ash, and charcoal separately. It is obvious that Mount Vernon should have more waste than Stonyclif because Mount Vernon is handling a larger quantity than Stonycliff for the past so many years and specially Mount Vernon and Stonyclifis following two different manufacture methods and CTC manufacture which handling more Recycle teas and consists more drier fluff waste which Stonycliff doesn't. Further we cannot compare CTC manufacture with Rotorvane manufacture at any point.
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Viii). I give below my explanation in connection to the overspent sum of Rs.
2,824,428/- as at the end of January 2022.
The estimated cost of one meter of Firewood is Rs, 2100/- ( including transport) subsequently our low country estates supplying the Firewood for Rs.2200/- ( without transport) per meter and the transport cost per meter firewood is Rs,1300/- and the total cost of one-meter firewood is Rs,3500/-. Due to the increase in firewood rate the over-expenditure recorded under this item.
Ix.) The Hot water Boiler Radiator was out of order from September 2021 and 11 tubes were blocked. This was handed over to M/s. Mechmar Engineering who is the manufacturer of this Boiler as per the REAF bearing number 07. But they informed us this radiator is beyond repairs and to replace with a new one. This also the main reason for the low output. Further, we have not settled the Firewood supplier's bills and most of the Firewood suppliers are not supplying Firewood to Mount Vernon Estate. due to the above reason, we were compelled to transport Firewood from our Low country estates for our day to day manufacture process. Due to the above reason, we are facing serious problems to maintain a buffer stock. Most of the time we do not have any other alterations but to use available wet Firewood for manufacture which was badly affected the Firewood output and recorded an over-expenditure of the particular item.
X. I totally disagree with the position stated in the report to the effect that correction fluid has been used and figures altered in the sifted Tea book in order to manipulate the quantities. No quantity has been changed or tampered with within the book. The Senior Assistant Factory Officer has made rectification in the Brought forward figures by using correction fluid for which I have reprimanded him not to repeat such acts of the same nature. This has been brought to the notice of the Chief Auditor as well as at the time of the audit and the chief Auditor also advised the same to the Senior Assistant Factory Officer Mr.S.Yogeswaran not to repeat acts of the said nature ( photocopy of the relevant section of the connected page of the sifted Tea Book is attached)
Xi)Taking into account the multiple numbers of green leaves that are brought into the
Factory from all divisions of the estates it is practically not possible to
maintain such records at the main entrance to the Factory. Only the outside vehicles which are coming to the office and factory details are recorded in the "Outside vehicle register".
Estate Storekeeper is maintaining a book connected to leaf transport and in that book he is maintaining all updated details in connection to the vehicle details on a daily basis and one Assistant Manager is certifying the details in that Book. This book was already produced to the chief auditor during the course of the audit.
5 .
I below my comments with regard to the footnote made on page No-2 of the Audit Report by the Chief Auditor in
the footnote he quotes.
Auditor Quote
“
Our point of view, any teas which are discarded from manufacturing process
should be considered as refused teas “
I totally disagree with his definition and give below the definition of Refuse Tea published by the Sri Lanka Tea Board in accordance with the "Tea controller act 10 of 1983".
A copy of the documents is attached -
REFUSE
TEA MEANS FLUFF, MATURE PRODUCT ( NOT OBTAINED IN SWEEPINGS, RED LEAF, STALK, OR ANY OTHER BEING MADE TEA) THE PROCESS OF MANUFACTURE OF TEA.
Further, Ceytea
Uniliver Liptons has the undermentioned
parameters and CTTA approved these parameters with regard to BMF which was
extracted from the Refuse Tea
Quoted below the parameter.
Parameter Range
Moisture
less
than 12% ( ISO Method)
Extractable
solids More
than 30% ( AOAC Method)
BMF should be with characteristic Tea notes when brewed with boiling hot water. Tea must not accompany a stale taste or smell.BMF must be free from mold and foreign matters.
Therefore sweepings cannot include with Refuse Teas.
In the light of the above-mentioned explanations tendered by me, I trust I have sufficiently given my comments/ explanation in connection to the Audit quarries which had been raised unreasonably and maliciously in the Audit report.
I
further wish to bring to your kind attention that since my assuming duties at Mount Vernon Estate from December 2018 I
had strive to serve the estate and the company to the best of my ability as in
the past in an honest, diligent, and in a responsible manner.
I am prepared to furnish further information and clarification in this regard if required.
Yours Faithfully,
Manager
Mount Vernon Estate