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  • Envisioning Growth Through Innovative Solutions

  • 02 Softlogic Finance PLC | Annual Report 2018/2019

    CONTENTS

    Vision, Mission & Values 04

    Our Sustainability Philosophy 06

    Our Reporting Philosophy 07

    Our Journey 08

    Financial Highlights 10

    Chairman’s Message 12

    Chief Executive Officer’s Review 15

    Board of Directors 20

    Board of Directors’ Profiles 22

    Executive Management 24

    Executive Management Profiles 26

    Our Geographical Footprint 28

    Corporate Governance Philosophy 88

    Corporate Governance Disclosures

    Disclosures mandated by the Companies Act No. 07 of 2007 90

    Disclosures mandated by the Sections 7.6 and 7.10 of the Listing Rules of the CSE 90

    Disclosures mandated by the CBSL Directives 94

    Level of Compliance with the Code of Best Practice on Corporate Governance 107

    Governance Reports

    Directors’ Statement on Internal Controls 123

    Report of the Audit Committee 124

    Report of the Remuneration Committee 125

    Related Party Transactions Review Committee Report 126

    Report of the Integrated Risk Management Committee 128

    Statement of Directors’ Responsibilities 129

    Annual Report of the Board of Directors’ on the Affairs of the Company 130

    Investor Information 202

    Ten Year Summary 206

    Branch Network 208

    Corporate Information 210

    Notice of Meeting 211

    Notes 212

    Form of Proxy 215

    About Us 03 Accountability & Transparency 87

    Supplementary Information 201

    Key Value Drivers

    Financial Capital 42

    Customer Capital 46

    Business Partner Capital 51

    Human Capital 54

    Infrastructure Capital 64

    Intellectual Capital 66

    Creating Sustainable Value

    Our Sustainability Philosophy 68

    Economic Contribution 69

    Social Contribution 70

    Environmental Contribution 72

    Integrated Risk Management 74

    Management Discussion & Analysis 41

    Stakeholder Identification and Engagement 30

    Our Value Creation Model 36

    Corporate Strategy on Value Creation 38

    Our Approach to Value Creation 29

    Independent Auditors’ Report 136

    Income Statement 139

    Statement of Financial Position 141

    Statement of Changes in Equity 142

    Statement of Cash Flows 143

    Significant Accounting Policies 144

    Notes to the Financial Statements 166

    Financial Statements 135

  • 03Softlogic Finance PLC | Annual Report 2018/2019

    Vision, Mission & Values 04

    Our Sustainability Philosophy 06

    Our Reporting Philosophy 07

    Our Journey 08

    Financial Highlights 10

    Chairman’s Message 12

    Chief Executive Officer’s Review 15

    Board of Directors 20

    Board of Directors’ Profiles 22

    Executive Management 24

    Executive Management Profiles 26

    Our Geographical Footprint 28

    ABOUT US

  • Softlogic Finance PLC | Annual Report 2018/201904 Softlogic Finance PLC | Annual Report 2018/2019

    VISION To be the preferred non-banking financial institution in Sri Lanka

    To strive to delight our customers through custom-made financial solutions, served through our professional and highly motivated team, committed to excellence.

    To create shareholder value through stability and above- average returns.

    To sustain our continued commitment to being a good corporate citizen, and make a positive contribution to the community and the environment.

    MISSION

  • Softlogic Finance PLC | Annual Report 2018/2019 05Softlogic Finance PLC | Annual Report 2018/2019

    VALUES Performance We are committed to a result-oriented culture. We place customers at the centre of our activities and we hold ourselves responsible to deliver what we promise in keeping with customer needs.

    Innovation We constantly challenge conventional wisdom and develop new solutions to meet customer requirements.

    Integrity We act fairly and honestly. We believe in ethics and transparency in all our dealings.

    Human Capital We benefit from the diversity of our business and our people by working together to achieve success. We treat all our staff with respect and dignity, provide opportunities for their career enhancement and reward them for good performance.

    Success We always strive to be the best in our business and possess a will to win.

    Corporate Responsibility We care for the community and the environment taking the responsibility to protect them. We are a good corporate citizen and support worthy causes and CSR projects.

  • 06 Softlogic Finance PLC | Annual Report 2018/2019

    OUR SUSTAINABILITY PHILOSOPHY

    Our corporate machinery has been designed and driven to give primacy to the interests of all our stakeholders in our pursuit to build a sustainable business that can withstand the vagaries of the industrial and economic environment that we operate in.

    In this quest, the integrated value creation process that we have championed through our Business Model has contributed significantly to ensuring that we are geared towards developing and sustaining a holistic growth drive that positively impacts all our stakeholders.

    Investors – Our decision making process and our short term and long term financial objectives have always been aligned with the aspirations of our investors so that they receive sustainable returns for their investments. We are committed to providing them with all relevant information in a timely manner so that they are well informed when making investment decisions.

    Employees – Our actions have undoubtedly proven that we regard our employees as the lifeblood of our company. We focus on professionally developing them so that they would continue to add strategic value to our business. Further, as a part of our employee value proposition, we offer our employees a rewarding, safe and challenging work environment for them to professionally and personally excel in.

    Customers – The expectations of our customers always take the forefront in our business operations. Our financial solutions have been designed with the demands of our customer segments in mind and we are not afraid to aggressively restructure existing products or introduce new solutions to cater to the evolving aspirations of our clientele. We are committed to continuously reengineering

    our processes to ensure that the customer service levels we offer are never compromised. In short, the entirety of our business operations is committed to fostering a service culture.

    Business Partners & Suppliers – Our commitment to fostering and maintaining long term, mutually beneficial relationships with our suppliers and business partners has been instrumental in developing the overall value proposition that we offer our clientele. Our engagement mechanism with them is collaborative and we have committed ourselves to ethical and transparent business practices.

    The Environment – All our business decisions and operational activities have been designed to ensure that we operate in an environmentally sustainable manner and invest in environmental conservation initiatives.

    The Community – We actively foster long term partnerships and engagements with the communities that we serve and actively immerse ourselves in community development initiatives so that we have an intimate and unbreakable bond with the communities around us.

    The Environment

    Our Integrated Value Creation Model

    Investors Employees

    Customers

    Business Partners & Suppliers The Community

  • 07Softlogic Finance PLC | Annual Report 2018/2019

    A B

    O U

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    EATIO N

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    EN T D

    ISC U

    SSIO N

    & A

    N A

    LY SIS

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    TA B

    ILIT Y &

    TR A

    N SPA

    R EN

    C Y

    SU P

    P LEM

    EN TA

    R Y IN

    FO R

    M ATIO

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    FIN A

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    IA L STATEM

    EN TS

    OUR REPORTING PHILOSOPHY

    Reporting Context Welcome to our fourth Integrated Annual Report! As a company that is committed to delivering responsible and transparent financial solutions to its customers, our objective is to present actionable and relevant information to all our stakeholders in order to empower them with the ability to make informed decisions about our company. We have adopted the Integrated Reporting methodology propagated by the Integrated Reporting Council in order to effectively communicate our value creation story to our stakeholders in a multi-dimensional and cohesive manner.

    Our focus is on delivering sustainable value creation to all our stakeholders that could withstand the vagaries of the industry that we operate in. This demands an intrinsic awareness and a penetrative insight into our value creation process, our responsibilities to our stakeholders and the economic, social and environmental impacts that our business produces. To this end, we have reported on the key inputs to our value creation process, which we have identified as our value drivers. These have been presented as input capitals in the form of Financial, Customer, Business Pa