SOEs given one-and-a-half months to strengthen internal audits

Privatization and Corporatization Board (PCB) has given State-owned Enterprises (SOEs) until the end of January to strengthen internal audit and risk management functions, as the latest report by the board show multiple companies operating at a massive loss.

According to the Q1 review released by the PCB, 12 SOEs collectively accumulated over MVR 280 million in losses during the first quarter.

In a circular released on Tuesday, the PCB said that during a board meeting on Wednesday, they decided to instruct SOEs to:

• Ensure the risk management function of companies is run as an independent department or is a part of the internal audit department, and to remedy it as soon as possible if this is not the case
• Conduct an assessment to identity the number of employees needed to carry out the internal audit and risk management function, and ensure they have the appropriate number of employees, with a priority on hiring technical staff over managerial staff
• Share procurement reports with the PCB as well as internal audit departments as required under the revised procurement guidelines for SOEs
• Share quarterly financial reports and supporting documents with the PCB as well as internal audit departments as required under the revised procurement guidelines for SOEs
• Conduct a compliance audit or review on an annual basis at the least to check for compliance with PCB’s instructions, policies and guidelines, and have the internal audit department share it with the company’s board or relevant committee, and establish a strong internal mechanism for improvement

The PCB gave SOEs one-and-a-half months to make the changes.

“We therefore ask that you make the necessary changes by January 31, 2026. We also ask companies to instruct relevant departments to proactively share the documents required to strengthen internal audits,” reads the circular.

ސަރކިއުލަރ: ސަރުކާރު ހިއްސާވާ ކުންފުނިތަކުގެ އިންޓާރނަލް އޮޑިޓް އަދި ރިސްކު މެނޭޖްމަންޓް ފަންކްޝަން ހަރުދަނާ ކުރުމާ ގުޅޭ.
އިތުރު މަޢުލޫމާތު: https://t.co/b7zDGEwonW pic.twitter.com/XGRAVMWbXo

— Privatization & Corporatization Board (@pcb_gov) December 16, 2025

The latest weekly fiscal report released by the Finance Ministry last week shows the state has spent MVR 1.9 billion on SOEs. This marks an excess of MVR 1.6 billion from the 2025 budget allocation of MVR 378.3 million.

And according to the Q1 review released by the PCB, the whole SOE sector consists of more than 37,900 employees. This far exceeds even the total number of employees in the civil service, which is 30,436.

The alarming numbers come amid public concern regarding SOEs, primarily regarding the high state spending on loss-makers, the prevalence of corruption, and the political favoritism, nepotism and cronyism in the hiring process.