The report presents the findings of the Auditor General on the consolidated financial statements of Jubbaland State of Somalia for the year ended 31 December 2021 . It evaluates whether public funds were properly managed, reported, and used in accordance with the law.

The Auditor General issued a qualified audit opinion, meaning the financial statements are largely compliant with the Public Financial Management (PFM) Act 2017 and IPSAS standards, but contain significant issues that affect their full reliability . Key concerns include unreconciled financial variances amounting to approximately USD 1.38 million and substantial payments made without adequate supporting documentation.

The audit identified systemic weaknesses in public financial management, particularly in revenue collection, expenditure control, procurement, and asset management. Revenue systems were found to be weak, with gaps in recording and reconciliation, increasing the risk of underreporting and leakages. Payment processes frequently lacked proper documentation, undermining transparency and accountability.

Procurement practices showed persistent non-compliance with regulations, including limited competitive bidding and overuse of single sourcing, raising concerns about value for money and potential fraud risks. Additionally, the absence of a proper fixed asset register and asset tracking system means government assets cannot be reliably monitored or safeguarded.

Banking and cash management controls were also inadequate, with failure to properly verify and reconcile government bank accounts. These weaknesses reflect broader deficiencies in internal control systems across government institutions.

Progress in implementing previous audit recommendations has been very limited, with only 7 out of 40 recommendations fully implemented. This indicates weak follow-through and accountability mechanisms within the Ministry of Finance and other entities.

Overall, the report concludes that internal controls remain weak and largely unchanged from previous years, and that existing legal frameworks are often not enforced. These shortcomings create significant risks of mismanagement, misuse of funds, and unreliable financial reporting. Strengthening internal controls, enforcing compliance, and improving oversight are critical to enhancing financial accountability in Jubbaland State.