By Nuh Mohamed - Reporter
Mogadishu — Somalia's Auditor General Ahmed Isse Gutale met Favori LLC Somalia representative Mustafa Durgut to discuss the company’s financial statements.
The talks focused on ensuring the revenue from Aden Abdulle International Airport is recorded transparently, and that the company implements audit recommendations related to revenue management and the annual auditing of its financial statements.
The meeting addressed the need for the company to fully implement the revenue-sharing agreement it has with the Federal Government of Somalia and ensure its financial statements undergo independent audit before submission to relevant government authorities.
Audit reports from recent years have repeatedly raised concerns about how to verify government revenue generated from revenue-sharing agreements. The Office of the Auditor General has stated that without audited financial statements, it becomes difficult to independently confirm whether the government’s share has been calculated accurately.
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In 2022, government revenue from Favori LLC was reported at US$3,110,280. In 2023, Favori’s contribution under revenue-sharing agreements was reported at US$3,972,500. In 2024, Favori LLC was reported to have contributed US$4,006,136.30. However, the Auditor General has repeatedly noted that the absence of independently audited financial statements limits the ability to verify whether these amounts represent the government’s correct share.
A special audit report by the Office of the Auditor General on the Favori LLC and Decale Hotel agreements for 2021 and 2022 also highlighted serious issues. The report stated that Favori LLC was paying the government 13% of gross revenue, while the agreement required the government to receive 25%.
The Auditor General has previously recommended that Favori LLC and the Ministry of Transport and Civil Aviation strengthen oversight, separate financial accounts, provide financial evidence, and fully implement all provisions of the agreement. These recommendations are aimed at ensuring that the government receives its correct share.