The Government borrows amounts in foreign currencies
to fund the development of SLTL’s network.
These amounts have been re-lent to SLTL with shorter
repayment periods than the underlying loan. The
loan balance as at 31 December 2001 is Rs. 14,627
million (2000 - Rs. 13,590 million). Exchange fluctuations
on repayments of these loans are borne by the Government.
Among the above loans, one loan was fixed in
Sri Lanka Rupees at the exchange rate on the date
of incorporation of SLTL or on the draw down dates
of the loan facility, as appropriate. Accordingly,
the exchange losses on this loan is borne by the
Government of Sri Lanka. The interest rates were
fixed at 13% per annum. The liability as at 31
December 2001 is Nil (2000 - Rs. 386 million).
SLTL bears the foreign exchange risk and the
related costs on a loan re-lent by the Government
(the loan not among the above loans), bearing
interest at 10% per annum. The balance as at 31
December 2001 is Rs. 1,483 million (2000 - Rs.
2,426 million).
Certain Government re-lent loans amounting to
Rs. 2,492 million (2000 - Rs. 3,312 million) have
been granted on condition that at least 25%-30%
of the average capital expenditure on the related
projects is funded from funds generated internally.
These projects have been completed as at the Balance
Sheet date.
The Government has guaranteed third party loans
amounting to Rs. 9,408 million
(2000 - Rs. 10,354 million).
Total value of loans that have neither been
guaranteed nor secured is Rs. 4,215 million
(2000 - Rs. 6,311 million).
The majority of the loans require SLTL, among
other matters, to submit audited financial statements
to the lenders within stated periods of the calendar
year-end, and to maintain adequate accounting
records in accordance with generally accepted
accounting practice.
The Directors believe the Company will have
sufficient finances available to meet its present
commitments. |
