Browsing by Author "Gunaratne, Y.M.C."
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Item Causes for Internal Audit Outsourcing in Sri Lanka, Evidence from Listed Companies in Colombo Stock Exchange(Uva Wellassa University of Sri Lanka, 2018) Madamawickrama, P.G.; Gunaratne, Y.M.C.Internal audit outsourcing is an undeniably imperative issue for the accounting profession and there is an ongoing debate on internal audit outsourcing in the literature. Yet, there is an increasing trend in outsourcing the internal audit function in Sri Lankan companies. Hence this explanatory study investigates the causes which influence the decision of internal audit outsourcing in Sri Lanka using survey data of 40 companies listed in the Colombo Stock Exchange, who have outsourced some or all of their internal audit functions. The technical competence, cost saving, corporate strategy and firm size were considered as the measures of the independent variable, the causes for Internal Audit outsourcing while the dependent variable is Internal Audit outsourcing. Correlation coefficient analysis and regression analysis techniques were used to analyze the data using SPSS version 16. The results revealed that the technical competence, corporate strategy and firm size are significant and have a positive relationship with the outsourcing decision while the cost saving is an insignificant and negatively affected cause in Internal Audit outsourcing decision. Further, this study revealed that Internal Audit outsourcing is exceedingly connected with the technical competence of the external service provider. These results imply that internal audit outsourcing is a developing business opportunity for professional business organizations. Hence the researcher suggests the professional firms to improve the technical competence in order to get more businesses.Item Effect of Capital Inadequacy on the Growth of Small Scale Sole Proprietorships in the Communication Industry: The case from the Badulla District(Uva Wellassa University of Sri Lanka, 2010) Karunananyake, K.M.P.D.B.; Gunaratne, Y.M.C.Starting & running a business with adequate amount of capital is very much important factor in case of achieving growth. Basic business format like sole proprietorships face number of challenges when acquiring capital. Lots of theories and experts do extract lack of capital as a severe bottleneck for growth of small businesses. There are number of other factors which can influence the growth according to both theory and practice. The research was carried out with the intention of identifying existing situation and analyzing the degree of relationship between lack of capital and the growth opportunity. A random sample consisting 60 sole proprietors who operate in the communication industry in Badulla district was selected for the study and the data were analyzed using both descriptive and inferential statistics. The study reveals that (a) there is a strong attitude among sole proprietors as lack of capital is a great barrier towards growth; (b) capital & growth has positive relationship (c) initial capital is the most decisive factor towards growth; (d) but in overall consideration there is no significant impact on growth of capital as it shows by business owners' attitude when it considers as isolated factor. However, the study concludes that the initial capital has a considerable influence on business growth while both additional capital and retained profits have no considerable impact on growth of a sole proprietorship. Key words: Lack of capital, Growth, Sole proprietorshipsItem Empirical Study of Factors Enhancing Purchase of Life Insurancein Sri Lanka(Uva Wellassa University of Sri Lanka, 2012) Nadeeshani, M. A. S.; Gunaratne, Y.M.C.Life is full of risks and uncertainties since, people are social human beings, and they have certain responsibilities too to minimize these risks. Sri Lankans are emotional and rational in their buying decisions and they believe in future rather than the present and desire to have a better and secured future. In this direction, life insurance services have their own value in terms of serving as savings, investment and risk protection. "Life insurance is the business of affecting the contracts of insurance upon human life including any contract whereby the payment of money is assured on death or the happening of any contingency dependent on human life and any contract which is subject to the payment of premiums for a term dependent on human life" (Epetimehin, 2011) The literature reviewed has shown that life insurance business has a high growth rate in Sri Lanka and on the other hand, relatively low penetration of the sector (Insurance board of Sri Lanka, 2011). It indicates that there is still a considerable unexplored potential. The developments in the finance sector are the main triggers of the expected future purchase (Outreville J.F., 1996) and life insurance companies having a bad reputation in terms of reliability (Oldenboom and Abratt, 2000). The rising customer awareness and aspiration of quality service and availability of alternative service providers in Sri Lankan market has made customers more demanding. The insurance company's ability to attract and retain new customer is a function of not only what it offers but also how it serves its existing customers ((Jha, S.M., 2000). Since, insurance companies are not different from other industrial organizations with respect to selling of their products, i.e., insurance policies; product differentiation can make an impact. 1BSL annual report has shown that Sri Lanka is a country where the average selling or purchase of a life insurance policy is still lower than many other Asian countries. This has led to a considerable unexplored potential of life insurance in Sri Lanka. With so many life insurance products available, one continues to wonder why the majority of Sri Lankan population does not have any life insurance policy. The objectives of the study were to identify the factors enhancing the purchase of life insurance and to compare the differences in consumer perception of male and female consumers.Item Empirical Study on Economic Benefits of Promoting Own Brand in the Local Tea Industry in Sri Lanka(Uva Wellassa University of Sri Lanka, 2010) Deshan, W.H.M.; Gunaratne, Y.M.C.The purpose of this study was to explore the opportunities of promoting own brand in the local tea industry. The findings of this study will help the parties who want to promote their own brands in the local tea industry. Primary data were collected using direct interview method while annual reports and other publications were used to collect secondary data. The study revealed that the promoting own brand is not effective compared to the local market portion with the export volume of the tea industry. According to the study, exporting tea or following the other promotional methods are more profitable than promoting own brand in the local market. Further, it reveals that, most of the companies mainly based on the export market rather than local market. Furthermore, they mainly concentrate in their exporting capacity and they are reluctant to spend financial resources on creating own brand to the local market. The main constrain for promoting own brand was identified as lack of money. Giant companies spend huge monies for the promotional campaign to increase their share in the local market. When newly entered firms are not in a position to face that much of competition they would be unable to sustain in the local tea market. Keywords: Branding, Plantation Companies, TeaItem Enterprise Resource Planning Systems and Operational Performance(Uva Wellassa University of Sri Lanka, 2013) Lakmal, K.G.G.S.; Gunaratne, Y.M.C.The Enterprise Resource Planning (ERP) systems are gaining popularity in the current turbulent business environment as a mechanism of integrating the cross functional business units. An ERP system is a software that helps organizations to integrate their business functions through a common database and enable planning and utilization of organization wide resources (Silva et al., 2008). Operational performance is firm's performance measured against standard or prescribed indicators of effectiveness, efficiency, and environmental responsibility such as, cycle time, productivity, waste reduction, and regulatory compliance. As an operational system, the possibility to exploit the potential of ERP system can be achieved by having proper training as well as vendor support (Silva et al., 2008). The ERP system implementation is a huge investment and it affects not only the organizations but also the entire country in long run in indirect manner. Considering the Sri Lankan manufacturing sector as one of the pivotal sectors in the economy of the country, identifying whether such investments add value to the organization is a vital need. Since the available knowledge on the said matter is limited, through this study, the researcher examined whether ERP has made any positive impact on operational performance of the manufacturing sector in Sri Lanka. Hence, the study objectives were to determine the relationship between user training on IT and three operational factors which are gaining operational performance, to examine the relationship between vendor support and three operational factors which are gaining operational performance and to determine the impact of ERP system on operational performanceItem Identification of Impact of Stock Splits on Liquidity Aspect of Stocks(Uva Wellassa University of Srilanka, 2011) Gunaratne, A.G.D.L.K.; Gunaratne, Y.M.C.Note: See the PDF Version Stock splits are a common and a very popular tool used by the corporations to increase the liquidity of stocks in the equity markets. A stock split can be defined as the increase in the number of outstanding shares of stock while making no changes in shareholder's equity. Splits are usually announced to create liquidity in a firm by reducing its share price and increasing the number of shares outstanding. While this does not impact on the intrinsic value of firms, it attracts retail investors as it is more affordable to them, The primary objective of a share split is to make a certain share more affordable to small investors by splitting the share at an agreed ratio. However, .a stock split does not change the intrinsic value of a stock and market capitalization of it at the time of the announcement of the split. Increased liquidity is the main advantage of stock splits. Liquidity can be generally defined as "the ability to trade large quantities quickly at low cost with less price impact". Through a stock split a corporation tries to increase the liquidity of the equity stock in the secondary market and the organization can reduce the cost of capital since the organization does not have to concern on the liquidity premium that the shareholders of the company are expected. This study attempted to identify the impact of stock splits on liquidity of a share. Therefore, this study aimed to address the question of, what is the liquidity behavior of a share after a stock split. Effect of stock split on liquidity of a share compared to the period before the split is analyzed in this study. Furthermore, this study identified the change of liquidity behavior of a share after the split in relation to the market. This study was based on 20 share splits which had been undertaken in Colombo Stock Exchange in the years of 2009 and 2010.Item Identification of Internal factoras Affecting to Profitability in Insurance Industry with Reference to Composite Insurance Companies in Sri Lanka(Uva Wellassa University of Sri Lanka, 2013) Dilrukshi, E.K.I.; Gunaratne, Y.M.C.Insurance services are now being integrated into wider financial industry and the insurance sector plays an important role in service based economy of Sri Lanka. Profitability is one of the most important objectives of financial management because one goal of financial management is to maximize the owner' s wealth and profitability is very important determinants of performance. This paper investigated the determinants of profitability in composite insurance companies of Sri Lanka. Specifically this examine the effects of firm specific factors are company age, size of company, volume of capital, leverage ratio and liquidity ratio and underwriting risk on profitability peroxide by ROA. A key indicator of insurance companies profitability is return on assets (ROA), defined as the before tax profit divide by total assets (TA). Profitability is dependent variable while firm specific factors consider as independent variable. The sample in this study includes 12 composite insurance company as ageing life and non-life insurance companies which cover the period of 2007- 2011. Secondary data obtained from the financial statements of insurance companies. Result show that Company age, size, volume6 of capital, underwriting risk have positive relationship and leverage has negative relationship. Liquidity is not significant.Item Impact of Cash Conversion Cycle on Firms’ Profitability (Special Reference to Listed Beverage Food and Tobacco Companies in Colombo Stock Exchange)(Uva Wellassa University of Sri Lanka, 2019) Keerthiratne, K.G.C.B.P.; Gunaratne, Y.M.C.; Deyshappriya, N.P.R.; Yapa, U.A.S.The Cash conversion cycle, where the decisions about investments in accounts receivable and inventories and about acceptance of credit from suppliers. It is one of the most generally utilized estimations to evaluate the risks and returns associated with liquidity management. Every corporate organization is extremely concerned about how to sustain and improve profitability, hence they have to keep an eye on the factors affecting profitability such as inventory management, accounts receivables and also accounts payables. Consequently, the main purpose of the study is to identify the impact of CCC on firm’s profitability with reference to the Beverage Food and Tobacco industry. The study is concerned about evaluating how CCC impact on the profitability of Beverage Food and Tobacco sector companies listed in CSE in Sri Lanka. The profitability was measured in terms of Return on Equity (ROE) and Return on Assets (ROA). The CCC was determined by Inventory Conversion Period (ICP), Receivable Conversion Period (RCP), and Payable Conversion Period (PCP). The study covering a sample of 14 Beverage Food and Tobacco companies and data were collected by concerning the time period from 2009 to 2017. Correlation statistical techniques and Panel data regression were used to analyze the relationship and impact the between CCC and the firm’s profitability. Results revealed that ICP has a negative relationship and significant impact on the firm’s profitability. Further RCP and PCP are positively impacted on ROE and ROA. Finally, overall CCC negatively correlated with the firm’s profitability and has a significant impact on firm’s profitability. Therefore, the study suggested that managers can create value for their shareholders by reducing the number of days of overall cash conversion cycle to a reasonable minimum.Item Impact of Corporate Social Responsibility Disclosures on Institutional Ownership of the Highest Turnover Non-Financial Companies in Sri Lanka.(Uva Wellassa University of Sri Lanka, 2019) Koswaththa, H.N.; Gunaratne, Y.M.C.; Deyshappriya, N.P.R.Corporate Social Responsibility (CSR) is a vital source for organizations to increase their social reputation in the competitive markets. Organizations actively participate to disclose their CSR activities through annual reports in order to make an overall picture of the organizations’ social value creation process. Institutional Owners (IO) are one of dominant party who has high investment portfolios. However, there is no consensus in the literature about the impact of CSR Disclosures (CSRD) on IO in Sri Lankan context. There for this study examines the impact of CSRD on IO of the highest turnover nonfinancial companies in Sri Lanka. Data were collected from annual reports of 25 listed non-financial companies which are categorized under LMD 100 in Sri Lankan Business Magazine (SBM) over the period from 2011-2017 based on annual turnover. CSRD measured through a grading procedure under 67 disclosure items and IO indicated through number of shares owned by institutional owners. As control variables, firm leverage and firm size used. Descriptive statistics, correlation analysis and random effect regression model of panel data analysis were used for the statistical analysis. The finding of this study revealed that there is a significant and positive relationship between CSRD and IO. Furthermore, CSRD significantly and positively impact on IO. Firm leverage negatively impacts on IO while firm size positively impact on IO. In conclusion, it is confirmed that, when non-financial companies engage with effective CSR disclosure procedure, institutional investors tend to invest in those companies with the feeling of less risky investment. The findings of this research will be crucial to the non-financial companies in Sri Lanka to enhance the disclosing procedure of CSR in order to gain more institutional investors’ attraction and results also will provide guidance for organizations which are engaging with poor CSR disclosures.Item Impact of Corporate Social Responsibility on Corporate Financial Performance: Evidence from CSE Enlisted Manufacturing Companies in Sri Lanka(Uva Wellassa University of Sri Lanka, 2020) Jayasundara, K.P.D.C.M.; Gunaratne, Y.M.C.; De Silva, P.O.Corporate Social Responsibility (CSR) is considered as an approach that contributes to sustainable development by delivering economic, social, and environmental benefits to all stakeholders. However, there is no consensus in the literature on the relationship between CSR and financial performance of corporations. Hence this study endeavored to explore the impact of CSR on corporate financial performance referring to the manufacturing companies listed in the Colombo Stock Exchange in Sri Lanka. The Stakeholder Perspective Theory provides valid insights to develop a CSR scale and it was used to measure CSR whereas the Return on Assets and Return on Equity were used as the proxies for the Financial Performance of corporations. Further, the risk ascertained through the Debt-to-Equity ratio considered as the control variable. The sample of this study consisted of ten manufacturing companies listed in the Colombo Stock Exchange and the sample period spaned for five years from 2011 – 2018. Accordingly, the study used 50 firm-year observations for the analysis and this study was based on secondary data and quantitative approach. Descriptive statistics, correlation coefficient, and panel data regression analysis techniques were used to accomplish the objectives of the study. The results revealed that CSR had a significant positive impact on the corporate financial performance of listed manufacturing companies in Sri Lanka. Moreover, it revealed that the control variable of risk had a significant negative relationship with Return on Assets while an insignificant relationship with Return on Equity. This study recommends the companies to maintain CSR activities at optimum level for all stakeholders as it leads to improve financial performance. . Keywords: Corporate financial performance, Corporate social responsibility, Colombo Stock Exchange, Return on assets, Return on equityItem Impact of Credit Risk Management on Financial Performance of Licensed Commercial Banks and Licensed Specialized Banks in Sri Lanka(Uva Wellassa University of Sri Lanka, 2019) Gamage, H.L.; Gunaratne, Y.M.C.; Jayasundara, J.M.P.V.K.; Deyshapriya, N.P.R.Credit risk management of banking sector has become more a crucial aspect of financial system, since it has been facing difficulties over the years. It refers a situation where the borrower has failed to repay loan or interests when they are due. Hence this study analyzed the impact of credit risk management on financial performance of licensed commercial banks and specialized banks in Sri Lanka. And the study further attempts to examine nature of aforementioned relationship based on banking soundness index indicators CAMEL (Capital adequacy, Assets quality, Management efficiency, Earnings and Liquidity). Return on Equity, Net Interest Margin and Earnings per Share used as the measurements of financial performance. Bank size considered as a control variable. Data were collected from 12 commercial banks and 3 specialized banks out of 32 banks in Sri Lanka. The key data source is the audited annual financial statements of selected banks over the 7 years (2011-2017). Pearson correlation and random effect panel regression model were employed to analyze the data. The results revealed that Capital adequacy and Asset quality have negative insignificant impact on financial performance while Loan to Deposit has negative and significant impact on financial performance. In contrast, Management efficiency and Earnings have positive significant impact on financial performance of LCBs & LSBs in Sri Lanka. Therefore, this study suggests that CAMEL model can be used as a proxy for credit risk management and conclude that credit risk still remains a major predictor of the performance of banks in Sri Lanka. The study recommended that banks should initiate Basel III framework, hedge the risk, do the loan portfolio diversification and integrate proactive & reactive approaches to mitigate the credit risk as much as possible to earn high performance and to reduce the compliance risk as well.Item Impact of Credit Risk Management on Performance of Microfinance Institutions (Special Reference to Mannar District, Sri Lanka)(Uva Wellassa University of Sri Lanka, 2020) Subakeerthana, S.S.; Gunaratne, Y.M.C.; De silva, P.O.Credit risk management in microfinance institutions has become more important not only due to the financial crisis that the industry is experiencing currently but also a due to the crucial concept which determines the financial and social performance. The objective of this study was to identify the impact of credit risk management on the performance of microfinance institutions and to identify the significant factor of credit risk management which affects the performance of microfinance institutions. The researcher has used a controlled environment, credit risk assessment, monitoring, and control activities as the key elements in managing credit risk. The study used a purposive sampling technique to select a sample of fifty employees from ten microfinance institutions in the Mannar district. Primary data were collected by distributing five-point Likert scale questionnaires, which consisted of thirty questions from two dependent variables and four independent variables. Descriptive statistics, correlation analysis, and multiple regression analysis were used to analyze the data. The study identified that credit risk management has a positive relationship with the performance of microfinance institutions concerning the Mannar district. Moreover, it ensures that monitoring had a significant impact on financial performance with the highest value of 0.59, and control activities had a significant impact on social performance with the highest value of 0.34. Finally, the study suggests to establish overall credit control and to have a system for monitoring the condition of individual credits. Keywords: Micro finance institutions, Credit risk management, Financial performance and Social performanceItem Impact of Dividend Policy on Share Prices of Listed Companies in Sri Lanka: Evidance from Bank Finance and Insurance Sector in Colombo Stock Exchange (CSE)(Uva Wellassa University of Srilanka, 2011) Wimalaratna, W.K.P.S.; Gunaratne, Y.M.C.Note: See the PDF Version Share market is a vital part in any economy as it helps investors to sell their securities in a secondary market at an efficient price. Further, it helps favorably to the initial public offering since most of the people invest in shares with the intention of selling those at a higher price in the future. Stock market gives a great opportunity to investors to buy and sell their shares at a satisfactory price in a well-functioning secondary market. Recently, there is a significant development in Colombo Stock Exchange (CSE). At present, 241 companies have been listed in CSE representing 20 business sectors. Investor seeks to earn the maximum return from their investment. As far as the return of the share market is concerned, total expected return includes two components namely, capital gains and dividends. Shareholders make investment in equity capital with the expectation of earning dividends or capital gains. Thus, shareholders can increase their wealth either from dividends or capital gains. Once the company earns a profit, Board of directors need to decide to retain the profit within the company or to pay it out as dividends to the owners of the company. Dividend policy determines the amount of earnings to be distributed to shareholders and the amount to be retained or reinvest in the firm. The objective of a dividend policy should be to maximize shareholder's wealth. Retained earnings are used to contribute investment opportunities which lead to increase the growth rate of the firm in the long run and the shareholders can obtain benefits of the retain earning in the long run. How much is needed to pay as a dividend is always a controversial topic for the business. Therefore management has to carefully design the dividend policy of the company in order to satisfy all the shareholders while achieving the company's objectivities satisfactorily. Company's profit after tax can either be divided among shareholders as dividend or can retain in the company or combination of these two. However, this may determine after comparing the costs of paying dividends with the cost of retain earnings. None of the companies has an obligation to declare dividends on common stock. However, director board can decide whether to pay or not dividend in the year. By maintaining a proper dividend policy a company can build a good image among the investors. Many theoretical models describe the factors that managers should consider when making dividend policy decisions. Miller and Modigliani (1961) states that in a given perfect capital market, the dividend decision does not affect firm's value and is, therefore, irrelevant. They offered many theories about how dividends affect value of a share and how managers should design their dividend policy. Stock Prices are changing according to the behavior of various factors. Some information regarding the stock prices such as earning per share, net assets per share highly affected the changes of stock prices because they reflect the strength of the company. Basically, investors consider companies' profitability, liquidity, leverage, asset utilization and future strategies when making the investment decisions. Accordingly, earning per share and net assets per share are the major information to the investors in their investment decision making. Thus, the second objective is how do earning per share and net assets per share impact on the market prices and how important those factors in investment decisions.Item Impact of Firms’ Adaptation of Eco-Friendly Product Innovations on Firm Performance (The Case of SMEs in Kurunegala District)(Uva Wellassa University of Sri Lanka, 2018) Bandara, H.M.T.D.; Fasana, S.F.; Gunaratne, Y.M.C.Recently, companies identified the concept of eco-innovation as a keyaspect of conducting business. According to National policy framework for Small and medium enterprises, eco-friendly innovation is a major policy initiative, which drives Small and medium enterprises. However, theliterature on eco-friendly innovation ismore focusedon identifying factors affecting adaptation and identifying customer perspective of eco innovations. Also,little research attention has been given in identifying the impact of eco initiatives provided by government and companies themselves for the betterment of organizations. Therefore, this study examines the relationship and the impact of eco-friendly product innovations on the performance of Small and medium enterprises with recognizing the importance of managerial environmental concern. Covering the above aspects, a model was constructed by taking the adaptation of eco-friendly product innovations as the independent variable, firm performance as the dependent variable and managerial environmental concern as the moderate variable. Data were then collected across 50 Small and medium enterprises in Kurunegala district covering eight sectors using convenient sampling. To achieve the desired objectives, the analysis was carried outusing Pearson correlation analysis, regression analysis, descriptive statistics and hierarchical regression analysis respectively. Results of the analysis indicated that adaptation of eco-friendly product innovations significantly and positively affects firm performance while managerial environmental concern enhances this relationship. Findings of this study enhance the literatureon understanding the impact of eco-friendly product innovations on firm performance and the importance of managerial environmental concern. Also this study suggests implementation of more programmes to integrate eco innovations into SME firms while providing some future research areas.Item Impact of Influencer Marketing on Purchase Intention of Cosmetic Products: Evidence from the Instagram Users in Sri Lanka(Uva Wellassa University of Sri Lanka, 2021) Mahakumbura, L.M.K.M.; Gunaratne, Y.M.C.Influencer marketing is a trending social media marketing technique that focuses to drive a brand‟s message to a larger market using influencers. Since the human beings are rapidly entering to the cyber universe in this digital technological era, such social media marketing can easily be continued with many organizational operations, including the arrival in the target market, the launch of products, handling customers‟ orders and sales etc. Despite the growing trend of influencer marketing technique around the globe, the impact of influencer marketing on purchase intention of Sri Lankan customers is an under researched area. The aim of this study was to investigate the impacts of influencer marketing on purchasing intention of cosmetics products of Instagram users in Sri Lanka. Based on the source credibility and source attractiveness model factors of influencers that can affect for the Instagram users‟ purchase intention are trustworthiness, expertise, likeability, similarity, and familiarity of influencers were considered as independent variable of this study. 200 Instagram users aged between 20 to 34 years who follows social media influencers in purchasing goods were selected using snowball sampling technique as the sample of this study and the response rate was 66%. The data were collected using a structured questionnaire. Descriptive Statistics, Correlation Coefficient Analysis and Simple Linear Regression Analysis techniques were used for statistical analysis using SPSS version 25 software. The study revealed that influencer marketing impacts on purchasing intension of cosmetic products in Sri Lanka. Further, it revealed that the trustworthiness of the social media influencer is the mostly affecting factor towards purchase intention of cosmetics products. Hence, this study recommends the marketers who use influencer marketing technique to pay attention on all the source credibility factors lending special consideration on the trustworthiness of the social media influencers. The findings of this study will contribute to the marketing literature in particularly to the social media marketing. Keywords: Followers; Influencer marketing; Instagram; Purchase Intention; social media influencersItem Impact of Loan Portfolio Diversification on Performance of Commercial Banks in Sri Lanka(Uva Wellassa University of Sri Lanka, 2019) Kumanayake, M.S.; Gunaratne, Y.M.C.; Deyshappriya, N.P.R.Credit risk attached with commercial bank loans can be considered as one of the main risks which commercial banks face. Thus, commercial banks diversify their loan portfolio to enhance performance through mitigating the credit risk. Loan portfolio diversification refers to providing loans to different sectors without concentrating on a particular sector. However, there is no consensus in the literature about the link between loan portfolio diversification and performance of commercial banks. Therefore this study examines the impact of loan portfolio diversification on performance of commercial banks in Sri Lanka. Hirschman Herfindahl Index was used to measure the loan portfolio diversification while performance measured by the CAMEL model. The Interest Rate Spread and Bank size were considered as the control variables. The sample consists of ten licensed commercial banks including six systemically important commercial banks in Sri Lanka out of 25 licensed commercial banks and the sample period spans for ten years from 2008 to 2017. The data were collected from published financial statements of sample companies and analyzed by using Pearson correlation coefficient and fixed effect panel regression model. The results revealed that there is a significant negative impact of loan portfolio diversification on performance of commercial banks. Further, both control variables-bank size and interest rate spread show a positive impact on performance of commercial banks. In conclusion, it is recommended that commercial banks should reduce their loan portfolio diversification as much as possible to increase the performance. The management should develop specific strategies on Loan Portfolio Diversification in order to improve the performance while paying high attention on loan portfolio position of the bank.Item Impact of Organizational Learning Climate on Innovative Work Behavior (With Special reference to the Middle Level Employees in Apparel Industry Sri Lanka)(Uva Wellassa University of Sri Lanka, 2019-02) Thilakarathna, H.D.S.A.; Sutha, J.; Gunaratne, Y.M.C.In recent times, innovative work behavior is the most important component in achieving competitive advantage. According to scholars, innovative work behavior is an essential part of the organization to sustain within the complex environment. However, limited research attention has been given in identifying the impact of organizational learning climate on innovative work behavior. Therefore, this research is conducted in order to identify the relationship and impact of organizational learning climate on innovative work behavior. By considering the above objectives, a model was constructed to identify the existing level, relationship and the impact between organizational learning climate and innovative work behavior and relative contributing factor of organizational learning climate dimensions on innovative work behavior. Data were collected across 3 major apparel leading manufacturers within Sri Lanka based on LMD ranking 2017 using convenient sampling technique. The Sample consisted of 120 middle level employees from 3 major apparel leading manufacturers. Data were analyzed by using Descriptive Statistics, Pearson Correlation analysis, and Simple and Multiple Regression analysis. Results concluded that impact of organizational learning climate significantly and positively impacts on innovative work behavior. The results of the study will be useful for practitioners and managers as this will drive them to alter or enhance the policies. This study also suggests some future research areas for further studies.Item Impact of Working Capital Management on Financial Performance of Non- Banking Financial Institutions in Sri Lanka(Uva Wellassa University of Sri Lanka, 2020) Ranaweera, H.G.O.H.; Gunaratne, Y.M.C.; Perera, K.J.T.Working Capital (WC) is reckoned as the animating spirit of an entity's concern. Consequently, it is imperative to accommodate the smooth running of operations in any organization. Yet the non-banking financial sector encountered many issues regarding managing cash as a component of WC and there is no consensus in the literature regarding the link between Working Capital Management (WCM) and financial performance. Hence, the objective of this study is to examine the impact of working capital management on the financial performance of non-banking financial institutes in Sri Lanka. WCM was measured using creditor’s payment period, debtors’ collection period, cash conversion cycle, current ration, and financial performance was measured using the return on assets and return on equity. Data were extracted from the annual reports of non- banking financial institutes covering a period of eight years from 2011 to 2018. Ten non- banking financial institutes out of 63 were considered as the sample based on the Fitch ratings. Data were analyzed through the Eviews statistical software using Pearson correlation and random effect panel regression model. The results reveal that there is a significant negative relationship between the debtor’s collection period and financial performance. Further, it exhibits an insignificant positive relationship between creditors’ payment period and cash conversion cycle and finally found that there is a significant positive relationship between the current ratio and financial performance. In line with the above findings, it is recommended that the non-banking financial institutes maintain a shorter debtor’s collection period as much as possible and a higher current ratio to enhance the financial performance. Further, it is recommended to adopt a conservative working capital strategy while paying a higher attention to the current ratio as the most affecting factor to the financial performance of non- banking financial institutes in Sri Lanka. Keywords: Working Capital Management (WCM), Financial performance, Return on Assets (ROA), Current ratio and conservative strategyItem Internal Audit Functions on External Auditor’s Reliance in Hotel Sector in Sri Lanka(Uva Wellassa University of Srilanka, 2011) Rupasinghe, M.W.N.R.; Gunaratne, Y.M.C.Note: See the PDF Version In today's world focus on corporate governance which has directed attention on roles played by internal and external auditors. Many successful organizations today are recognizing the importance of internal audit function as a key component of governance frame work within the organization. The growth of internal auditing over the years has led to more consideration for relying on internal audit work by external auditors. For the external auditor to rely on any work performed by the internal audit function the external auditor must assess the quality of the internal audit function. Internal audit function should have the considerable flexibility that external auditors have in using the work of the internal audit function should translate into a strong encouragement for companies to develop high-quality internal audit functions. SLAUSs 610 Considering the Work of Internal Audit described the relationship between external auditors and internal audit and outlining the various ways in which the external auditor can improve their efficiency and effectiveness by utilizing the work of the internal auditors. Several things to be considered in the process of establishing the internal audit work by the management in the organization. This research, attempts to identify the most significant factors in the strength of internal audit functions towards the external auditor's reliance in the organization. All business functions therefore become effective and efficiency throughout the sound internal control system by preventing duplication of work in auditing. Then the organization can achieve higher performance throughout the business functions and also sound internal control system leads to reduce external auditor's work throughout this the organization reduce the expenditure on external auditing.Item Investigation of Factors Affecting Agricultural Insurance Demand in Sri Lanka(Uva Wellassa University of Sri Lanka, 2012) Thennakoon, T.M.M.P.; Gunaratne, Y.M.C.Sri Lanka, like most of the countries in the Asian region has an agricultural economy and plays an important role in the nation's economy and social developn. ;pit. Though we had the self-sufficient economy in the past, today in most of the time the development of the country depends upon the commercial agriculture. It has become the backbone of the development of our country. Thus, central bank annual report has proved the contribution of Agriculture to Sri Lankan Gross Domestic Product (GDP)in 11.9% and source of er1.ployment for more than 32% of the Sri Lankan population (Central bank Annual Report, 2010). In that context, as a developing country, Agriculture has gained the most prominent position in Sri Lanka. However, annual losses in Agricultural sector are huge in Sri Lanka due to unexpected bad weather, adverse prices of agricultural production, damages from insects and other various diseases. If the farmers come across with huge losses, they are helpless and always looking for a financial assistant from an external party. All over the world, the use of Agricultural Insurance as a risk management tool has grown rapidly in recent years (Munich Re, 2009),In most of the countries, this kind of insurance policy was introduced almost four decades ago. In Sri Lanka, even though we have a great history, Agricultural Insurance is still not so popular (Poverty Portal Report,2010). Therefore, this research aims at an investigation of factors affecting the demand of agricultural insurance in Sri Lanka.