How Somalia's forensic audit has increased revenue collection by Sh103 million

Somalia's Auditor General Ahmed Isse Gutale. [Courtesy Somalia OAG]

Somalia’s Office of the Auditor General now says a three-year comprehensive audit of state agencies has led to a significant increase in monthly revenue collection.

In a statement released on July 2, 2024, Auditor General Ahmed Isse Gutale said the dramatic increases highlight the effectiveness of forensic audits in identifying and rectifying financial mismanagement.

Last month, Gutale released a forensic audit report that indicated the government had lost $25,909,521 an equivalent of Sh3.331 billion.

The said amount according to the report had been withdrawn from government accounts between March 8, 2018, and April 19, 2023.

The audits uncovered significant financial irregularities and embezzlement within several key government agencies, marking a critical step towards greater financial transparency and accountability in Somalia.

Gutale said the forensic audits were launched following a compliance audit in 2020 for the fiscal year 2019, which identified suspicious activities across multiple government sectors.

according to him, the in-depth investigation spanned three years, rigorously examining the financial activities of various departments.

“A total of 22 officers were accused by the Office of the Attorney General. Among them were 15 officers from the Immigration and Nationality Directorate, 3 officers from the Ministry of Finance and Central Bank, and 4 officers from the Ministry of Labor and Social Affairs,” said Gutale in a statement.

He said 11 of these officers have been convicted of criminal activities, receiving prison sentences ranging from 1 to 9 years.

Additionally, several individuals have been barred from government employment for five years.

In the audit, the work permits and visa extensions sector had collected $33,370,260 but only $12,437,690 was deposited into the Treasury Single Account leaving an alarming $20,932,570 unaccounted for.

In the passport services sector, Gutale said the audits found that of the $41,804,998 collected, nearly $4,976,951 was embezzled.

He said the findings underscored the urgent need for stricter financial controls and oversight within Somali government agencies.

“The forensic audits revealed that out of the $33.37 million collected from work permits and visa extensions, only $12.44 million was deposited into the Treasury Single Account indicating that over $20.93 million was embezzled,” said Gutale.

He said, “The discovery of over $25.9 million in embezzled funds was a clear indicator of the scale of financial mismanagement we have been able to address through our forensic audits”.

Gutale said the increase in revenue has empowered the Treasury Single Account to maintain government employees’ salaries without the need for additional support or loans starting from July 2023.

The audits, he said, have also clarified the legal responsibilities of all authorized officers and their representatives, ensuring better management and oversight of government properties.

He said the average monthly income from visa extensions for instance has risen from $160,419.67 to $439,045.00 after the audits.

In the work permit services, Gutale said the average monthly income increased from $43,476.89 to $358,400.

Gutale said the findings emphasise the critical need for ongoing vigilance and robust financial oversight.

“By recovering millions of dollars in embezzled funds, the OAG is ensuring that these resources are redirected to their intended purposes for the benefit of the public,” read part of his statement.

He said his office will ensure the recovered resources are redirected to their intended purposes for the benefit of the public.

He said the Office of the Auditor General of Somalia remains steadfast in its commitment to ensuring transparency and accountability within government operations.

“These forensic audits not only uncovered substantial embezzlement but also paved the way for improved financial practices across various government agencies, marking a significant step forward in the fight against corruption,” said Gutale.