International Journal of Economics, Commerce and Management United Kingdom Vol. V, Issue 4, April 2017 Licensed under Creative Common Page 287 http://ijecm.co.uk/ ISSN 2348 0386 FACTORS AFFECTING FINANCIAL PERFORMANCE OF INCOME GENERATING UNITS AMONG UNIVERSITIES IN PUNTLAND STATE OF SOMALIA: THE CASE PUNTLAND STATE UNIVERSITY (PSU) Mohamoud Hassan Mohamed Master of Business Administration, Department of Business Administration, Jomo Kenyatta University of Agriculture and Technology in Collaboration with Puntland State University, Puntland, Somalia jamaalxm@gmail.com Willy Muturi School of Business, Jomo Kenyatta University of Agriculture and Technology, Nairobi, Kenya Abstract Low funding has been one of the major problems facing higher Education institutions. The government is finding it more difficult to meet the vast needs of the society hence institutions are facing shortages intensively. In an attempt to bridge the gap between the budgetary allocations and actual expenditures most universities have started income generating units with the aim of boosting their operational expenses. This study sought to determine the factors that contribute to the performance of income generating units in universities in the Puntland State of Somalia using Puntland State University (PSU) as a case study. The study has four objectives being to determine the influence of firstly, resource allocation; secondly, internal control systems; thirdly, management capacity and finally work culture on the performance of these income generating units. The study is focused on nine income generating units that are operated by PSU. Both primary data on internal control systems, management capacity and work culture as well as secondary data on financial performance and resource allocation are used in the study. The study was based on the 2015 and 2016 financial statements of the income generating units of the case study. Data analysis was done using SPSS. The findings indicate that resource allocation, internal control systems and management capacity have a positive effect on financial