The Audited Consolidated Financial Statements of the Jubbaland State of Somalia (JSS) present the financial performance and position of the State for the year ended 31 December 2017, prepared in accordance with the International Public Sector Accounting Standards (IPSAS) under the cash basis of accounting.

The financial statements consolidate the accounts of all government reporting entities, including ministries, departments, agencies, and selected public institutions under the control of the State. The report reflects the Government’s efforts to establish a structured public financial management framework following the adoption of the Public Financial Management Act, 2017.

An independent audit of the financial statements resulted in a qualified opinion, primarily due to the absence of sufficient and appropriate supporting documentation for payments amounting to USD 9,371,702, representing approximately 55 percent of total reported expenditure. This limitation indicates significant weaknesses in financial controls, documentation practices, and transaction verification processes.

During the financial year, total receipts amounted to USD 17,077,405, derived mainly from tax revenues, external grants, and other internally generated income. Total payments recorded were USD 17,049,315, with expenditure largely attributed to employee compensation, use of goods and services, and operational costs. The State reported a closing cash balance of USD 64,968 at year end.

The audit further identified key control weaknesses, including inadequate segregation of duties in revenue collection and recording, lack of regular reconciliation between collected revenues and banked amounts, and challenges in confirming revenues received from the Federal Government of Somalia. These issues pose risks to the completeness, accuracy, and reliability of financial reporting.

External assistance continued to play a significant role in financing government operations. Grants were received from various international organisations and development partners, contributing substantially to the State’s revenue base.

Overall, the report highlights progress in establishing foundational financial management systems while underscoring the need for strengthened internal controls, improved financial reporting practices, and enhanced accountability mechanisms to ensure transparency and effective management of public resources within the Jubbaland State of Somalia.