The East African Legislative Assembly, in its ongoing July 2025 virtual sitting, has received and adopted the report of the Accounts Committee on the Audited Accounts for previous years.
In this case for the Financial Year which ended June 30th, 2022.
The report tabled by the chair of the Accounts Committee of East African Legislative Assembly (EALA), Mundela Mbombo Joseph, offered a comprehensive overview of the community’s financial status, achievements, and areas that require urgent attention.
“The 2022 audit reveals both strides made, and challenges faced by the East African Community.”
“We must now focus on the rigorous implementation of audit recommendations and foster a culture of transparency to ensure the community’s resources are utilized effectively for the benefit of all Partner States.”
The Assembly was presented with a comprehensive overview of the East African Community (EAC)’s financial operations during the year 2022.
According to the audited report, the Community operated with a budget of USD 105 million, but actual expenditure reached only USD 72.7 million, resulting in a budget absorption rate of 69 percent.
While donor funding saw a modest increase to USD 43.2 million, the EAC continued to face significant challenges in utilizing its budget fully.
These challenges were largely attributed to the delayed or non-remittance of funds from Partner States, which undermined the timely and effective implementation of planned projects and activities.
A central concern highlighted in the report was the substantial outstanding contributions from Partner States.
As of June 2022, these arrears totalled USD 71.3 million, a notable increase from the previous year’s USD 53.4 million.
This shortfall directly impacted the EAC’s ability to execute its mandate across its organs and institutions.
Human resource constraints were also underscored. Only 74 percent of approved staff positions across the EAC were filled, with 26 percent of positions remaining vacant.
The report attributed this shortfall primarily to funding limitations, which hindered the effective fulfilment of institutional mandates and contributed to operational inefficiencies.
The Committee on Accounts reviewed the implementation status of audit recommendations, noting that out of 301 recommendations, only 32 percent had been fully implemented by June 2022, while 39 percent remained unaddressed.
The Committee called for stronger management follow-up and more timely action to resolve outstanding issues and improve accountability.
The report identified several weaknesses in procurement and asset management. These included the inappropriate use of direct procurement methods, conflicts of interest in asset disposal, and inadequate documentation and valuation of community assets.
The Committee expressed concern over these lapses and emphasized the need for stricter adherence to established procedures.
Financial controls and VAT refunds were also a focus of the report. The EAC and its institutions faced significant delays in recovering VAT refunds from Partner States, with USD 5 million outstanding as of June 2022.
The Committee urged Partner States to expedite VAT remittances and called for improvements in financial controls and regulatory compliance.
On governance and strategic planning, the Committee highlighted the urgent need to finalize the long-pending Institutional Review Exercise, strengthen internal audit functions, and develop a coordinated approach to project management.
The absence of a comprehensive risk management strategy and an anti-corruption committee was identified as a key vulnerability for the Community.
To address these challenges, the Committee on Accounts made several recommendations to the Assembly and the EAC Council of Ministers.
These included enhancing follow-up on outstanding Partner State contributions, exploring alternative funding mechanisms, filling vacant staff positions, strengthening internal controls and procurement processes, expediting the Institutional
Review Exercise, developing a cost-optimizing travel policy, and establishing a coordinated project management unit with integrated IT systems for greater operational effectiveness.
The East African Legislative Assembly debated and took note of the delays in addressing audit queries, especially that key policy instruments were not adopted by the EAC Council of Ministers leading to delay in key bills on Integrity and accountability.
The Assembly reaffirmed its commitment to transparency, sound financial management, and the effective implementation of the EAC integration agenda.
The Assembly called on all Partner States and stakeholders to work collaboratively in addressing the challenges outlined in the report, with the goal of ensuring the sustainable growth and development of the Community.