📊 R&D Bottlenecks & Systemic Audit Issues Impacting Innovation

• National Context: Heavy systemic friction in public R&D auditing continues to stifle research productivity, hindering Sri Lanka's economic progress and driving local scientific talent abroad. • R&D ROI & Accounting Mismatch: Current auditing focuses strictly on physical asset verification (e.g., verifying 2013-era lab equipment) rather than measuring return on investment (ROI) or knowledge creation. State funding lacks clear output plans, leading to unproductive annual cycles without tangible economic benefits. • Impact on Key Sectors: Overtly rigid asset allocation policies prevent practical field use of specialized equipment (e.g., vehicle fuel sensors in transport energy research). The resulting environment restricts innovation across high-value technical fields such as ICT/BPM and engineering. • Brain Drain: Overly bureaucratic compliance pushes high-skilled research talent to relocate to foreign institutions (such as Australian universities), leaving Sri Lanka bearing the training costs while foreign economies capture the commercial value. • Proposed Reforms: Experts urge transitioning from traditional financial audits to a "development auditing" framework designed to clear execution obstacles, assess actual knowledge output, and enable national economic returns on public investments.